About SAFLII
Databases
Search
Terms of Use
RSS Feeds
South Africa: Johannesburg Labour Court, Johannesburg
SAFLII
>>
Databases
>>
South Africa: Johannesburg Labour Court, Johannesburg
>>
2017
>>
[2017] ZALCJHB 381
|
|
Old Mutual Life Assurance Company South Africa Ltd v Commission for Conciliation, Mediation and Arbitration and Others (JR541/14) [2017] ZALCJHB 381 (19 October 2017)
THE
LABOUR COURT OF SOUTH AFRICA, JOHANNESBURG
Not Reportable
Case no: JR541/14
In the matter between
:
OLD MUTUAL LIFE
ASSURANCE COMPANY
SOUTH AFRICA
LTD
Applicant
and
COMMISSION FOR
CONCILIATION, MEDIATION
AND
ARBITRATION
First Respondent
M S RAFEE
N.O.
Second Respondent
DR PANDELANI THOMAS
MATHOMA
Third Respondent
Heard:
07
September 2017
Delivered:
19 October 2017
Summary:
Review of award in
terms of which an employee’s dismissal for gross negligence and
dishonesty was substantively and procedurally
unfair - commissioner
failed to consider evidence fully - the Court independently assessed
and evaluated the evidence - found that
the commissioner’s
failure to deal with evidence constitutes a reviewable misdirection -
replacing the award with an order
that the dismissal was
substantively fair - finding on procedural unfairness upheld.
JUDGMENT
NKUTHA-NKONTWANA.
J
Introduction
[1]
This is an
application in terms of section 145 of the Labour Relations Act
[1]
,
(LRA) to review the arbitration award issued by the second respondent
(the commissioner) on 10 February 2014 under case number
GAJP9810-13. In terms of the arbitration award, the commissioner
found the dismissal of the third respondent (Dr Mathoma) by the
applicant (Old Mutual) to be substantively and procedurally unfair
and ordered his reinstatement.
[2]
This application is opposed by the third
respondent only.
Factual background
[3]
Dr Mathoma commenced employment with Old Mutual
on 1 May 2010. His position was that of a General Manager:
Corporate Affairs.
He was reporting to Mr Sonn who was at that time
the Director: Marketing, Corporate Affairs and Communications for
Emerging Markets.
Part of Dr Mathoma’s responsibilities
was the Old Mutual Foundation (OMF) and at that time Mr Sonn was the
Chairperson of
the OMF.
[4]
At the time of his appointment Dr Mathoma
was provided with a report that had been prepared by the Mthente
Research and Consulting
Services (Pty) Ltd (Mthente), a research
consulting firm. It is a report on internal audit of OMF carried out
by Mthente for purpose
of evaluation of the OMF’s repositioning
strategy and their skills set against international and local based
practice. Mr
Sonn had commissioned Mthente to provide the report
after it had submitted a detailed proposal pointing out the work to
be performed,
the time it would take and the precise costs involved.
Upon his appointment Dr Mathoma was required to execute the Mthente
report
as it constituted the future strategy of the OMF.
[5]
On 4 April 2011, Dr Mathoma entered into a
research sponsorship agreement with Afriwealth Consulting
(‘AfriWealth’)
to provide Old Mutual with two reports,
which were described as follows:
‘
The first report will focus on
leading corporations and social investment visibility through media
reports in South Africa, a trend
and analysis’
;
and
‘
The second report will be an
investigation into Old Mutual’s EVC/CSI projects in rural South
Africa, a case study’
.
[6]
The material terms of this AfriWealth sponsorship
agreement are summarised hereunder:
‘
1.
The parties agree to relate in good faith following the execution of
the
memorandum of understanding in order to pursue the execution of
the envisaged research project including the following elements:
a.
The parties agree to pursue the establishment of a working
partnership
in turn to enable the production of knowledge, exchange
of use of information for the purpose of promoting the improvement of
quality
Old Mutual rural community relations in South Africa and
beyond.
b.
Specifically, AfriWealth Consulting has been commissioned by Old
Mutual (Sponsor) to plan, carry out and submit two basic research
reports to the Sponsor in the course of 2011.
c.
Subject to Old Mutual agreed modifications, the first report will
focus on leading corporations and Social Investment Visibility
Through Media Report in South Africa: A Trend Analysis.
d.
Further and subject to mutually agreed modifications, the second
report will be an investigation into Old Mutual EVC/CSI Projects in
Rural South Africa. A case study.
e.
Both parties agree that the First Research Project will be supported
and funded by the Sponsor (Old Mutual) to the tune of R400 000 (Four
Hundred Thousand Rands + 14% VAT) payable on submission of
research
report by AfriWealth Consulting to the Sponsor.
f.
Both parties agree that the Second Research Project will be
supported
and funded by the Sponsor (Old Mutual) to the tune of R400 000
(Four hundred Thousand Rands + 14% VAT), payable
on submission of
Research Report by AfriWealth Consulting to the Sponsor.
g.
AfriWealth
agrees with the Sponsor to submit both reports on or before
5
th
December 2011, and in the same vein, the Sponsor agrees to pay
AfriWealth immediately (within seven working days) after the
submission
of the Research Reports.’
[7]
Mr Sonn testified that Dr Mathoma’s
intention to enter into an agreement with AfriWealth was never
discussed with him, as
the Chairman, and amongst the board of
trustees of the OMF. The AfriWealth agreement was not preceded by any
form of proposal or
costing by AfriWealth, such as the undertaking by
Mthente before it was commissioned to undertake the Mthente report.
In
addition to this, Dr Mathoma had put together the AfriWealth
agreement himself and had not sought the assistance of Old Mutual’s
legal department as required by the procurement policy.
[8]
On 31 August 2011 at 23h09 at night whilst using
his private email address, Dr Mathoma sent Professor Banjo from
AfriWealth an example
of an invoice for his attention. The next
morning at about 05h35 Professor Banjo emailed the invoice for the
first AfriWealth report
to Dr Mathoma’s private email address.
The said invoice was dated 31 August 2011.
[9]
The invoice was immediately approved by Dr
Mathoma, but it was subsequently re-issued due to deficiencies in the
invoice having
been detected and then approved by Dr Mathoma on
12 September 2011. The ultimate price that was charged by
AfriWealth was
R450 600.00 (four hundred and fifty thousand six
hundred rand) for the first report. This is despite the contract
price having
been R400 000.00 including VAT. This invoice was
subsequently honoured. The first AfriWealth report was paid before it
was
received as it was received sometime mid-September 2011.
[10]
On 1 September 2011 Mr Ralebitso commenced
employment as Director: Marketing, Communications and Corporate
Affairs and Dr Mathoma’s
direct supervisor. On 22 November
2011, the second Afriwealth report and the invoice were sent to Dr
Mathoma by Professor
Banjo. On 19 December 2011, AfriWealth
submitted a reworked invoice for the second report. The invoice was
approved by Dr
Mathoma the following day, but the invoice was
re-issued again and then subsequently approved by Dr Mathoma on
23 December
2011. It is apparent from the invoice that
Afriwealth charged R450 032.00 (four hundred and fifty thousand
and thirty-two
rands) for the second report despite not having
charged VAT. The amount of R50 000.00 included in the invoice
was accounted
for as stationery, printing, etc which had not been
contracted for in terms of the agreement. The invoice was
subsequently
paid by Old Mutual.
[11]
Different to the invoice for the first report,
the final invoice for the second report contained a breakdown of work
purportedly
undertaken by AfriWealth in compiling the report and was
based on an hourly rate for consultants set by the DPSA. The said
breakdown
was requested by Dr Mathoma himself who testified that he
was uncomfortable with the signing of the invoice in the absence of a
breakdown. Glaring in the said invoice is the anomaly in terms of the
manner in which Professor Banjo accounted for the work he
had
performed that led to the report. The invoice reflects that Professor
Banjo had worked on the report 24 hours per day for 90
days (at a
rate of R1 156.00 per hour), and the three research assistants
had worked on the report each for 87 days
at 24 hours per day
(at a rate of R240.00 per hour).
[12]
In arranging the expedited payment of the invoice
for the second AfriWealth report at the request of Professor Banjo,
Dr Mathoma
sent two emails to the finance department which are of
relevance:
12.1.
On 19 December 2011, Dr Mathoma sent an email to
Ms Nel, saying this about AfriWealth:
‘
I was not prepared to pay him
until we are happy with the entire report, hence I wanted to accrue
the money and pay him next year
when he would have made changes.
He has now effected the changes and I am happy with them.’
12.2.
On 20 December 2011, Dr Mathoma sent an email to
Ms Collison saying this about AfriWealth:
‘
I had not [anticipated] that I
will pay them [until] next year after they had revised the report to
our satisfaction. Now
they have done so. We are happy
with the product and I am therefore satisfied that we can pay.’
[13]
On 23 January 2012, the Group Forensic Services
(GFS) received an anonymous tip off to the effect that the
expenditure and payment
of the first AfriWealth invoice for
R450 600.00 was irregular and Dr Mathoma was implicated. From
the beginning of February
2012, Dr Tshitereke commenced work as a
Senior Manager and the Head of OMF. He reported directly to Dr
Mathoma and one of the other
direct subordinates of Dr Mathoma was Mr
Hadebe who was a Senior Manager: Stakeholder Relations.
[14]
On 27 March 2012, the GFS held an interview
with Dr Mathoma consequent to a tip off. On 3 April 2012 Dr
Mathoma sent an
email to Mr Venter, a Group Forensic Investigator in
which he explained the reason for the commissioning of the two
AfriWealth
reports. On 10 July 2012 GFS produced a case report
on the matter in which it found that the allegations against Dr
Mathoma
had not been established. On 11 July 2012, four of Dr
Mathoma’s direct reportees put in a grievance against him.
Amongst
them were Dr Tshitereke and Mr Hadebe. The complaints against
Dr Mathoma were wide ranging including several further allegations
about the AfriWealth reports.
[15]
On 18 July 2011, Dr Mathoma sent an email to
Mr Ralebitso, recording threats made by Dr Tshitereke who allegedly
orchestrated
his dismissal solely because Dr Mathoma had apparently
refused to drop a disciplinary case against Mr Hadebe.
[16]
On 15 August 2012, another interview was
conducted with Dr Mathoma by two GFS investigators, Ms Meijer and Mr
Venter. The minutes
of the said interview was sent to Dr Mathoma on
17 August 2012 and he made written corrections and then signed. Even
though Dr
Mathoma disputes the accuracy of the said minutes, they
recorded the following:
‘
Dr
Mathoma agrees that he did not follow the proper procurement process
according to the Old Mutual procurement policy purely because
of an
oversight on his part and pressure to deliver.
Annelie
[Meijer] asked Dr Mathoma if he took time to himself to read the two
documents that is the AfriWealth reports and Dr Mathoma
responded
that he needs to agree that the research document was of poor quality
and that he was not vigilant enough to ensure that
research was
properly conducted and reported on before payments were made.’
[17]
On 2 September 2012, the outcome of the
grievance that had been lodged by Dr Mathoma’s subordinates was
issued by Mr
Mathebula (an IR Change panellist) who was engaged to
consider the collective grievance. In relation to the complaints
about AfriWealth’s
reports, Mr Mathebula found that they were
not well-founded.
[18]
On 25 October 2012, GFS produced their
forensic report in which irregularities in Dr Mathoma’s
handling of the AfriWealth
matter were identified and recommended a
disciplinary action against him. On 31 October 2012, Dr Mathoma
sent an email to
Mr Powell, Head of Forensics in which he alleged
that Mr Venter and Dr Tshitereke were acting in cahoots to get him
dismissed.
[19]
In November 2012, the second Mathebula report was
issued. Mr Mathebula recommended that on the strength of the GFS
investigation,
Dr Mathoma had a case to answer in relation to
AfriWealth and he should be charged accordingly.
[20]
In November 2012, disciplinary charges were
brought against Dr Mathoma and are as follows:
‘
Charge 1: Misconduct –
Gross negligence
In that you failed to completely
perform the employer’s work by your course of conduct described
below which when viewed in
totality displays a grossly negligent
approach to the performance of your duties.
1.
Despite being aware of the Mthente report commissioned by Crispin
Sonn and produced in 2010 and
which looked at the strategic direction
of Old Mutual Foundation you concluded a contract with Prof Banjo
trading as AfriWealth
to produce two reports in 2011 which were
unnecessary as they covered the same scope as the Mthente report.
2. You
concluded this agreement with Prof Banjo without the authority or
knowledge of your seniors.
3. You
failed to follow any proper tender and procurement process in regard
to the contract concluded
with AfriWealth.
4.
Although both AfriWealth reports were intended to benefit Old Mutual
Foundation, you did not raise
or discuss the commissioning of
AfriWealth reports with the board or any of the trustees of the Old
Mutual Foundation nor did they
give their approval to proceed.
5. You
utilised your own General Management operational budget to pay
AfriWealth despite the fact
that the reports you requested were
intended for use by the Old Mutual Foundation.
6. You
failed to utilise the proper vendor contracting process including
usual detailed legal contract
prepared by Old Mutual Group Legal
Department in concluding the contract between Old Mutual and
AfriWealth.
7. You
failed to have due diligence done on AfriWealth which would have
established that it had been
deregistered as a Close Corporation (cc)
and that it was also not registered for VAT.
8. You
failed to disclose to your seniors that you had therefore incurred
liability of 2 x R400 000
which was approximately 10% of your
entire R9 million general management budget allocated for the
operation of your whole
function in 2011.
9. You
provided AfriWealth with a pro forma invoice in order for them to
then invoice Old Mutual in
respect of their first respondent which
they did in August 2011.
10. You authorised
payment in respect of their first invoice on no less than three
different versions of the invoice
before receiving any of the first
report.
11. The first
invoice also incorrectly contained VAT at 14% on the contractual
amount due to R400 000 which
VAT was also incorrectly calculated
as R50 600 instead of R56 000.
12. You authorised
payment of AfriWealth’s second invoice on 2 versions and when
it was pointed out to you
by Old Mutual Finance Department that
AfriWealth was not in fact VAT registered, you approved a fee of over
R50 000 instead
for secretarial and typing services for the
second report [yet this report did not even extend to 100 typed A4
pages].
13. You incurred
actual liability for Old Mutual of over R900 000 in 2011 for
work which was both unnecessary
and of poor quality (and subsequent
analysis show both reports contained significant proportion of
plagiarised and acknowledge
material drawn from the internet) and
without the knowledge or approval of your seniors at that time.
14. Only after the
Group Forensic Services Department began to investigate this matter
did you contact Prof Banjo
and request from him AfriWealth’s
company profile, background documentation and supporting
documentation regarding the invoices.
15. You subsequently
agreed that the agreement lacked detail and so posed a risk to Old
Mutual as it does not
now have any recourse given that the research
was not done to specific standard etc.
16. The amounts/fees
that you agreed to were not properly thought through nor discussed
with AfriWealth during
April 2011.
Charge 2: Misconduct –
Dishonesty
In that you dishonestly misrepresented
to Old Mutual that the information submitted indicated by you was
true and correct as follows:
1. You
emailed Ms Collison, an employee of Old Mutual Finance Department on
20
th
December 2011 at 17h52 indicating that AfriWealth had
revised their report to your satisfaction, that you were happy with
the report
and satisfied the Old Mutual can pay AfriWealth; yet on
another occasion in your interview with Group Forensic Department
indicated
you approved the payments to AfriWealth without reading or
quality checking the reports they gave you. You further
explained
that after the new Head of Foundation, Dr Clarence
Tshitereke, was appointed during 2012 you handed the due research
documents
to him and placed the responsibility on him to review the
two research papers.
2. In
your interview with Group Forensic Department you indicated you used
the “Government International
Relations and Corporations Terms
of Reference” document during April 2011, to determine the rate
per report. Yet you
only obtained this document in February
2012 [after the Group Forensic Services Department began to
investigate this matter] by
contacting Prof Banjo to request a more
detailed Terms of Reference document to understand the costs and fees
associated with both
reports.
Alternative to Charge 1 and 2:
Misconduct – Breach of common law duty
In that your above actions, conduct
and behaviour breached the common law duty owed by the employee to
the employer. These
include but are not limited to the duty of
trust and the duty to always act in the best interest of the
employer.’
[21]
Dr Mathoma’s disciplinary hearing was
conducted on 3, 7 and 13 December 2012 and 15 January 2013. Ms Sarah
Christie (an IR
Change panellist) was the chairperson. Dr Mathoma was
represented by an attorney, Mr Mabuza. On 4 February 2013, Ms
Christie
issued her findings wherein she found Dr Mathoma guilty of
gross negligence and dishonesty and recommended his dismissal. Dr
Mathoma
was accordingly advised on 8 February 2013 and his
dismissal took effect on 28 February 2013.
The arbitration
proceedings
[22]
In relation to substantive fairness, the issues
for determination were whether:
22.1.
Dr Mathoma was grossly negligent and / or
dishonest;
22.2.
discipline was applied consistently; and
22.3.
dismissal was the appropriate sanction (the
latter two issues arising only in the event of a finding of guilt).
[23]
In relation to procedural fairness, the issues
for determination were whether Dr Mathoma’s dismissal was
procedurally unfair
on account of one or more of the following
contentions:
23.1.
the company failed to lead evidence at the
disciplinary enquiry to establish that the employment relationship
was destroyed;
23.2.
Dr Mathoma was not afforded the opportunity of
submitting evidence in mitigation of sanction;
23.3.
the company did not seek dismissal as a sanction
at the disciplinary enquiry;
23.4.
Ms Christie travelled in a car with Old Mutual’s
representative after the enquiry on 3 December 2012;
23.5.
Ms Christie did not submit her findings to the
parties at the same time;
23.6.
there was irregular contact between Ms Christie
and Old Mutual around the amendment of Ms Christie’s findings;
and
23.7.
the notice of the disciplinary enquiry was not
issued in terms of procedure, in that the charges were not explained
to Dr Mathoma.
Summary of evidence
[24]
Old Mutula’s evidence can be summarised as
follows:
24.1.
Mr Sonn testified that the AfriWealth agreement
was not preceded by any form of proposal or costing by AfriWealth,
such as that
undertaken by Mthente before it was commissioned to
undertake the Mthente report. In addition to this, Dr Mathoma had put
together
the AfriWealth agreement himself and had not sought the
assistance of Old Mutual’s legal department as required by
procurement
policy. Dr Mathoma was required to execute the Mthente
report as it constituted the future strategy of the OMF.
24.2.
The AfriWealth reports added no value as they
contained information that was already in Old Mutual’s
possession. Some of the
chapters in the AfriWealth’s first
report were a “cut and paste” from the Mthente report. Dr
Mathoma never discussed
his intention to enter into an agreement with
AfriWealth with Mr Sonn, management team and/or the board of trustees
of the OMF
in line with Old Mutual’s culture. Old Mutual has a
fairly rigorous process to understand the value for money spent and
the
manner Dr Mathoma conducted himself did not commensurate with
that process and standard.
24.3.
On the conspiracy advanced by Dr Mathoma to the
effect that Dr Tshitereke was somehow responsible for his dismissal,
Mr Sonn testified
that it was implausible. Dr Tshitereke was
appointed by Dr Mathoma himself, who acknowledged in his evidence
that they knew each
other prior to both joining Old Mutual, and was
junior in rank to influence senior level decisions.
24.4.
Under cross-examination, it was put to Mr
Sonn that Dr Mathoma did not need approval to spend the R900 000
on the AfriWealth
reports as the money came from his so-called
discretionary pot. In response, Mr Sonn disputed this, stating
that the cost
of the reports came out of Dr Mathoma’s media and
promotion budget. He explained that the discretionary pot was a
funding
mechanism that was created by the previous CEO where, subject
to consultation, the funds were used to fund
ad
hoc
requests by different organisations such
as the government or individuals like Ms Graça Machel for the
funding of events.
As such, the discretionary pot was not a slush
fund that Dr Mathoma could use as he pleased, with the expenditure
always being
subject to internal consultation and controls.
24.5.
The evidence of Ms Meijer and Mr Venter primarily
related to the interview which they had conducted with Dr Mathoma on
15 August
2012, and the drafting of the minutes of the interview.
They corroborated each other that the minutes accurately recorded
what
transpired during the interview.
24.6.
Mr Venter was adamant that he had taken the
minutes to Dr Mathoma in his office on 17 August 2012, and that Dr
Mathoma had read
through them, made a few handwritten amendments and
then signed them. Mr Venter disputed the version put to him under
cross-examination
to the effect that Dr Mathoma had been present in a
meeting with Mr Ralebitso at the time that Mr Venter brought him the
minutes,
and that Mr Ralebitso had become impatient and advised Dr
Mathoma to sign the minutes, and then make any amendments later.
[25]
Dr Mathoma’s evidence can be summarised as
follows:
25.1.
He had authority to approve the R900 000
expenditure on the AfriWealth reports as his authorisation limit had
been increased
from R500 000 to R5 million. Dr Mathoma did,
however, concede under cross-examination that he had accepted at his
disciplinary
enquiry that his limit was R500 000 since he was
not aware that his limit had been increased when he authorised the
payment
of the AfriWealth reports.
25.2.
He commissioned the AfriWealth reports to do two
things which the Mthente report did not do; to look into what leading
corporations
were doing and the creation of Economically Viable
Communities (EVCs).
25.2.1.
On the scope of the first AfriWealth report, Dr
Mathoma testified that what he wanted to know from AfriWealth was
what distinguished
the CSI strategy of the top 10 corporates from Old
Mutual’s in view of the fact that they are successful and their
programs
so visible. However, he was unable to point out whether the
first AfriWealth report dealt at all with this fundamental issue
under
cross examination.
25.2.2.
Dr Mathoma, realising that report did not deal
with the fundamental issue, stated, for the first time that the
report was a work
in progress, and that the question would have been
answered in the final report and strategy that would have been
delivered by
Dr Tshitereke and Professor Banjo.
25.2.3.
Under cross examination, Dr Mathoma acknowledged
the following deficiencies in the first AfriWealth report:
25.2.3.1.
Chapter 1 (running to 16 pages) was no more than
a desk to review of literature on CSI;
25.2.3.2.
The whole of chapter 2 (running to 16 pages) is a
cut and paste from the Mthente report;
25.2.3.3.
Chapter 3 (running to 26 pages) contains mostly
information taken off websites, including bar graphs and pie charts,
with the only
original content in the entire report being at pages 38
to 39 of this chapter, that is a table reflecting the total number of
CSI
media reports received by the top 10 corporates;
25.2.3.4.
Chapter 4 and 5 (totalling 15 pages) are extracts
from writings of leading thinkers on CSI; and
25.2.3.5.
Chapter 6 (running to three pages) was a slightly
longer version of the executive summary at the beginning of the
report.
25.2.4.
On the second AfriWealth report, Dr Mathoma
confirmed the accuracy of what he stated in his email to Mr Venter on
3 April 2012
about the purpose of the report. As Dr Mathoma had
recorded:
‘
The second report focused on
the future and I wanted them to help us with the development of our
future CSI strategy that would
put us in the same ranking as or even
better than the leading corporations surveyed in the first study. I
asked them to make the
linkages with the Government’s national
priorities, the Masibambisane Rural Development Initiative (MRDI)
initiated and led
by the President of the Republic, and our Imbizo
programme done with the support of our Black Business Partners
(BBPs), especially
Wipihold. I also wanted the new strategy to
include the revitalised roles of the Provincial Management Boards
(PMBs) who
are at the coalface of our interaction with the
communities.’
25.2.5.
When Dr Mathoma was asked whether the second
report achieved these objectives to justify expending R400 000
on it, his answer
was that ‘we were on a journey, this was part
of a journey and the conclusion was the strategy’. He was also
expecting
Dr Tshitereke and Professor Banjo to work on the reports,
incorporating ‘empirical evidence’ that would have been
delivered
by Professor Banjo to produce a final report. As a result,
he was satisfied that he did achieve his objectives.
25.3.
The costs of the AfriWealth reports came from his
discretionary pot and as such there was no need to follow procurement
process
or consult with anyone in the absence of a policy regulating
this expenditure. Under cross-examination Dr Mathoma was confronted
with the fact that he had not said this at his disciplinary enquiry.
25.4.
In relation to the interview on 15 August 2012,
he denied that the contents of the minutes were a true reflection of
what he had
said during the interview.
25.4.1.
It emerged during cross-examination that
Dr Mathoma’s version of defence as advanced by his legal
representative at the disciplinary
enquiry was that t
he
reason he did not engage the legal department was because he was
overstretched at the time
. That
is
consistent with Ms Meijer and Mr Venter’s
evidence on what Dr Mathoma had said during the 15 August 2012
interview. Dr
Mathoma’s response was evasive, stating that ‘I
did not say that I am overstretched I said these are other things
that
I am doing’.
25.4.2.
He also disputed Mr Venter’s version of the
circumstances surrounding his signing of the minutes of the interview
on 17 August
2012. He stated that he had been in a meeting with
Mr Ralebitso at the time and was pressured to sign the minutes and
then deal
with Mr Venter later.
25.4.3.
However, under cross-examination, Dr Mathoma,
conceded making handwritten amendments on the very page on which the
two damaging
statements allegedly made by him are recorded. He also
conceded that his version that he signed the minutes under pressure
from
Mr Ralebitso was different from a version he gave at his
disciplinary enquiry.
25.5.
On the issue of his relationship with Dr
Tshitereke, it was Dr Mathoma’s evidence that it had
deteriorated from May 2012 onwards
and he considered Dr Tshitereke to
have been behind his dismissal. Under cross examination, it was put
to Dr Mathoma that, since
the allegations of his gross negligence and
his dishonesty had already arisen by the end of December 2011, the
deterioration of
his relationship with Dr Tshitereke from May 2012
could not have had any bearing on the alleged acts of misconduct that
took place
in 2011 to substantiate his conspiracy theory.
25.6.
Regarding the issue of inconsistency, he referred
to the incident where Ms Zondo had incurred some R2.7 million in
expenditure when
her authorization limit was only R500 000.
25.7.
Dr Mathoma conceded that, given the seniority of
his position and the fact that he worked in the financial sector, if
he had acted
negligently with company funds and could not be trusted
to give a proper explanation for his conduct, the company would have
been
entitled to dismiss him.
25.8.
On the charge of dishonesty, Dr Mathoma testified
that he had requested the Head of Group Procurement, Ms Heidi
Kinciad, whether
it was appropriate for him to ask the finance
department to accelerate payment of AfriWealth. When Dr Mathoma was
questioned about
the false statements in his emails to Ms Nell, on 19
December 2011, and to Ms Collison, on 20 December 2011, to the
effect
that changes to the second AfriWealth report had been effected
to his satisfaction, his response to this was that he had sought
permission from Ms Kinciad and discussed with Mr Ralebitso. This
explanation was not helpful to Dr Mathoma because he had testified
that the discussions with Ms Kinciad and Mr Ralebitso pertained to
the accelerated payment and not the quality of the report. Clearly,
the contents of these two emails were deceiving since the report had
not been revised.
25.9.
Regarding the R50 000 charged in the invoice
for the second AfriWealth report for stationeries, printing,
photocopying USB,
secretarial and editorial services, Dr Mathoma
stated that he had noticed it, and had, nevertheless, approved
payment despite the
fact that no such amount had been contracted for
in the AfriWealth agreement.
25.10.
It was put to Dr Mathoma that the standard of
diligence shown by him in approving the AfriWealth invoices fell so
far short of the
standard expected of a senior manager in a financial
services company that this, in itself, warranted dismissal, Dr
Mathoma disagreed.
25.11.
Dr Mathoma conceded that Old Mutual was
reasonably entitled to expect that he would only authorise payment
for a report once
he was satisfied that it had been delivered and
completed, up to the standards expected by him.
25.12.
Regarding the procedural challenges, the
commissioner correctly dismissed the claim that the charge sheet was
not read to Dr Mathoma
since he is highly literate.
25.13.
On the claim of the trip to the airport, Dr
Mathoma admitted that Ms Christie had informed them that she was
going to travel to
the airport with Mr Estie, and his legal
representative did not object. Regarding Ms Christie having corrected
two errors in her
report, Dr Mathoma was adamant that she had been
placed under duress to do so. Dr Mathoma further argued that Old
Mutual breached
its own disciplinary code in both incidents.
[26]
Nothing much turned on the evidence of Dr
Mathoma’s three witnesses being Ms Bonisiwe, Ms Zandile and Ms
Matodzi; save to
show that he continued to help employees of Old
Mutual post his employment.
Findings by the
commissioner
[27]
On the question of whether Dr Mathoma was grossly
negligent and dishonest,
the
commissioner made the following findings:
‘
56.
The two reports that had been commissioned by the Applicant in his
agreement with
Professor Banjo are central to this dispute. On the
face of the reports there are certainly many issues that can be
commented upon
without being an expert. None of the parties
called expert witnesses. The spelling mistakes, the format, the
syntax
errors and grammatical gremlins and cut and paste are clearly
patent. Further, the need for bar and pie charts over a period of
10
years reflect the same data reconfigurated in a different model. The
extent to which that was necessary appears, on the face
of it, not to
be the case.
57.
The reports, according to the Applicant were firstly, to fill the gap
of the
Mthente report and secondly, that the Afriwealth report ‘flow
from’ the Mthente report and all the reports were effectively
‘working progress’ (sic). This would have all
culminated, according to the Applicant, in his broader vision of
seeking the Respondent being placed in the top 10 companies and later
as a number one. This evidence was uncontested and
therefore
must stand.
58.
The payment made from the discretionary pot relates to the issue of
whether
or not, firstly, the Respondent had a policy for the use of
the discretionary pot. The Applicant was at pains during
cross-examination
to explain that there was no policy, neither was
there any policy produced during the course of these proceedings.
Perhaps
that is the reason why it was called a discretionary pot that
was placed at the sole disposal of a person placed in the position
of
the Applicant.
59.
Mr. Crispin Sonn testified that the Applicant had an amount of
R500 000.00
that he could spend clearly in his discretion, which
he did. I cannot agree with Mr. Crispin Sonn that the Applicant
was
required to consult with him or the management team or with the
Board of Directors. The Applicant held a very senior position
and it was for that reason that he was given the discretion. To
now interfere with this discretion appears to have its origin
in the
malice that was harboured in the heart and head of Dr Clarence
Tshitereke.
60.
Further evidence of this interference of the discretion can be found
in the
conclusions reached in the first report of Mr. Johnny
Mathebula and what motivates the same author to come to a different
conclusion
some two months later appears to fit in with the
Applicant’s proposition, being the conspiracy theory. In
my view,
for the same author to come to two different conclusions in
a period of two months’ time which are effectively poles apart
seems to support the Applicant’s conspiracy theory.
61.
The Applicant placed facts before this arbitration of discretionary
spending
regarding 3 x R300 000.00 and the payment to the
Mapungubwe Institute (see paragraph 27 above). I find that the
Applicant’s
conduct was neither grossly negligent nor
dishonest.’
[28]
Despite having found Dr Mathoma not guilty of
misconduct, the commissioner still dealt with the issue of
inconsistency and was of
the view that:
‘
62.
Whether discipline was applied inconsistently as alleged by the
Applicant. The
fact of the matter indicates that the Respondent
had acted inconsistently in applying its discipline as there was an
example given
by the Applicant of how his line manager had
effectively protected a subordinate in circumstances where the
expenditure incurred
was much more than what occurred in the
Applicant’s case.
62.
Ms. Nthabe Zondo had signed off the sum of R2.7 million and she was
protected
by Mr. Mohole Ralebitso. This occurred despite Ms
Zondo having submitted a letter of resignation.’
[29]
On the issue of procedural fairness, the full
text of the commissioner’s findings is as follows:
‘
64.
On procedure, there can be no justifiable reason why the chairperson
did not give
the Applicant an opportunity to present mitigating
factors nor can it be considered appropriate for the Respondent’s
representative
to argue that the Chairperson ‘fairly made the
recommendation that she made on the strength of the evidence that had
been
led before her’. If that indeed were the case, then
there would be no need to present mitigating factors after finding
an
employee guilty.
65.
It is also clear that although the Respondent had not called for the
dismissal
of the Applicant, the chairperson nonetheless chose to go
down that route.
66.
For the chairperson to have informed the Applicant and the
Applicant’s
representative that she would be travelling with
the Respondent’s representative on the 3
rd
December
2012 is clearly irreconcilable with what may be considered
impartial. The perception of bias is certainly justified
if a
chairperson of a disciplinary enquiry informs either side that the
chairperson would be travelling with their opponents.
67.
The chairperson was required to, in my view, perform in terms of the
agreement
that was reached at the end of the disciplinary hearing by
communicating to both parties. She instead chose not to
communicate
with the Applicant. This then led to a further
perception of bias in that it was the Respondent’s
representative who
asked the Chairperson to ‘correct’ the
findings (as there were two specific gaps in the findings) which was
later done.
The conduct of the Chairperson led the Applicant to
harbour a reasonable apprehension of bias.’
[30]
Following, the commissioner ordered that Dr
Mathoma be reinstatement retrospectively and with back-pay equivalent
to 12 months’
salary.
Legal principles
[31]
The
Labour Appeal Court (LAC) has, in recent decisions,
conclusively
endorsed the refined and clarified operation of the
Sidumo
test
articulated in
Herholdt
v Nedbank Ltd (COSATU as amicus curiae)
[2]
and
Goldfields
Mining SA (Pty) Ltd (Kloof Gold Mine) v Commission for Conciliation,
Mediation and Arbitration.
[3]
In
Palluci
Home Depot (Pty) Ltd v Herskowitz and Others,
[4]
citing
Head
of the Department of Education v Jonas Mohale Mofokeng and Others
[5]
with
approval, the following was stated:
’
Significantly,
as was held by the SCA in
Herholdt
and
endorsed recently by this Court in Head of the
Department
of Education v Jonas Mohale Mofokeng and Others
“for a defect in the conduct of the proceedings to amount to a
gross irregularity as contemplated by s 145(2)(a)(ii) of the
LRA, the
arbitrator must have misconceived the nature of the enquiry or
arrived at an unreasonable result”.
Thus,
as recognised in Mofokeng, it is not only the unreasonableness of the
outcome of an arbitrator's award which is subject to
scrutiny, the
arbitrator “must not misconceive the inquiry or undertake the
inquiry in a misconceived manner”, as this
would not lead to a
fair trial of the issues
.
In further approval of Herholdt, this Court in Mofokeng stated that:
‘
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, evidence 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 inquiry, undertaken the inquiry 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.’ [Footnotes omitted]
[32]
In
Fort
v COEGA Development Corporation (Pty) Ltd and Others,
[6]
the
LAC
dealing with the
evaluation
of the evidence by the commissioner, likewise, stated the following:
‘
[51]
It must immediately be said that there is no merit in the argument
that the Court a quo was conducting
a process of reverse reasoning.
In the end, the conclusion reached by a trier of fact must account
for all the evidence presented
at the trial and by parity of
reasoning during the arbitration. In
S
v Trainor
[7]
Navsa JA provided the following useful guide and principle with
regard to the evaluation of evidence:
‘
A
conspectus of all the evidence is required. Evidence that is reliable
should be weighed alongside such evidence as may be found
to be
false. Independently verifiable evidence, if any, should be weighed
to see if it supports any of the evidence tendered. In
considering
whether evidence is reliable, the quality of that evidence must of
necessity be evaluated, as must corroborative evidence,
if any.
Evidence, of course, must be evaluated against the onus on any
particular issue or in respect of the case in its entirety.
The
compartmentalised and fragmented approach…is illogical and
wrong.’
[52]
The SCA held that an assessment of the
evidence based on demeanor, without regard to the wider
probabilities,
constitutes a misdirection. In
President
of the Republic of South Africa and Others v South African Rugby
Football Union and Others
the
Constitutional Court pronounced that the advantages which the trial
court enjoys should not be over-emphasised 'lest the appellant's
right of appeal becomes illusory'. The truthfulness or untruthfulness
of a witness can rarely be determined by demeanor alone without
regard to other factors including the broader probabilities. In that
case the Court applied the principles enunciated in
R
v Dhlumayo and Another
in
particular the following instructive guidelines:
'10.
There may be a misdirection on fact by the trial Judge
where the reasons are either on their face unsatisfactory or where
the record
shows them to be such; there may be such a misdirection
also where, though the reasons as far as they go are
satisfactory,
he is shown to have overlooked other facts or
probabilities.
11.
The
appellate Court is then at large to disregard his findings on fact,
even though based on credibility, in whole
or in
part according to the nature of the misdirection and the
circumstances of the particular case, and so come to
its own
conclusion on the matter.’
[8]
[Emphasis added]
Grounds
of Review
The commissioner
failed to deal with evidence presented on dishonesty charge
[33]
Old Mutual argued that the commissioner failed to
deal with the charge of dishonesty brought against Dr Mathoma. Even
though this
charge has two elements, it would seem that Old Mutual
abandoned the second element as its evidence at the arbitration and
submissions
in this Court mainly focused on the false statements that
Dr Mathoma had made to the finance department in procuring payment of
the invoice for the second AfriWealth report in December 2011.
[34]
The evidence of Dr Mathoma in this regard is
reflected in paragraph 33 and 34 of the award and is also outlined
above. The commissioner
found Dr Mathoma not guilty of dishonesty
without explaining how he arrived at that conclusion. As such, the
commissioner misdirected
himself as his finding is not supported by
reasons based on evidence.
[35]
Had the commissioner applied his mind to the
evidence before him, Dr Mathoma would have been found guilty of
dishonesty for the
following reasons:
35.1.
Dr Mathoma conceded under cross examination that
the contents of the second AfriWealth report had not been changed
when he wrote
both emails. He tried unsuccessfully to hide behind Ms
Kinciad and Mr Ralebitso as in his own version the discussion he had
with
Ms Kinciad and Mr Ralebitso pertained to his request for the
accelerated payment without insisting on changes to the report.
35.2.
Clearly, the contents of these two emails were
deceiving. Furthermore, this version flies in the face of Dr
Mathoma’s earlier
version to the effect that since he was using
a discretionary pot, he did not need to consult or discuss his
actions with his senior
colleagues.
[36]
I agree with Old Mutual’s submission that,
in failing to deal with a central issue or question for
determination, the commissioner
misconceived the true nature of the
enquiry, and thereby committed a gross irregularity. On this ground
alone, the award stands
to be set aside.
The commissioner
failed to decide several elements of the gross negligence charge
[37]
The commissioner was plainly
obliged to consider all the evidence in relation to all the
elements
of a charge of gross negligence.
[38]
At paragraph 56 of the award, the commissioner
correctly established that the Afriwealth reports were the crux of
the matter. He
also accepted that the reports were not of good
quality as they were riddled with spelling mistakes, bad formatting,
grammatical
and
typographical
errors. That the information was cut and paste and that
reconfigured data therein was unnecessary. Had he properly applied
his mind,
the commissioner would have found that, by accepting the
two AfriWealth reports without insisting on improvements and
approving
payments for the shoddy work, Dr Mathoma indeed acted in a
grossly negligent manner.
[39]
Much was made of
Dr
Mathoma’s authority to use the discretional fund/pot to pay for
the AfriWealth reports. Old Mutual led evidence to show
that, during
the GFS interview on 15 August 2012, Dr Mathoma admitted to
having been negligent in failing to follow the procurement
process
and failing to ensure that the reports were adequate before
authorising payment. The commissioner accepted Dr Mathoma’s
version without
assessing the
credibility of the witnesses; their reliability; and the inherent
probabilities of the two conflicting versions.
[40]
Dr
Mathoma’s evidence to the effect that since he was using his
discretionary pot, he could thumb suck a figure to be expended
on
services procured without satisfying himself that such expenditure
has value and is in the interest of Old Mutual, is
irrational. Mr
Sonn testified that the discretionary fund was an
ad
hoc
funding mechanism that had to be used subject to consultation and
accountability in terms of practice. In my view, the source of
funding for the reports could not have exonerated Dr Mathoma from
exercising
a degree of care expected of a senior manager in his
position.
[9]
[41]
The commissioner accordingly misdirected himself
once again.
Afri
W
ealth
reports being a work in progress and this being uncontested
[42]
The commissioner readily accepted the evidence of
Dr Mathoma that he approved payment of about R900 000 for both
AfriWealth
reports regardless of the quality of the work produced and
pertinently, because they were work in progress as uncontested. The
commissioner ignored the following material facts:
42.1.
That this
version emerged for the first time during Dr Mathoma’s
cross-examination. As a result, it was never put to Mr Sonn
under
cross-examination.
It
is well established that a failure to put to a witness the version of
witnesses of the opposing party who are yet to testify
is a
reviewable irregularity.
[10]
42.2.
That this version is highly improbable as Dr
Tshitereke was yet to be employed when Dr Mathoma approved the
payment for the reports.
Also, it contradicts Professor Banjo’s
evidence at the disciplinary enquiry that he never submitted any
draft reports.
42.3.
That this version contradicts Dr Mathoma’s
evidence in chief to the effect that the reports were helpful and
contributed in
the development of the CIS strategy that Dr Tshitereke
presented to the OMF’s Board of Trustees on 12 March 2012. That
strategy,
according to Dr Mathoma, endorsed the recommendation by
AfriWealth on the creation of Economically Viable Communities which
became
part of his score card. Evidently, adoption of the strategy
concluded the assignment and there was no need for any further
‘
empirical evidence’ from Professor
Banjo as alleged by Dr Mathoma.
[43]
The
commissioner’s finding that
Dr
Mathoma’s evidence in this regard was uncontested
,
constitutes a reviewable misdirection.
[11]
Dr Mathoma’s
conspiracy theory
[44]
The commissioner made two findings in support of
Dr Mathoma’s conspiracy theory:
44.1.
Firstly, the company’s action in
disciplining Dr Mathoma amounted to it interfering with the
discretion afforded him to spend
his discretionary pot, and ‘appears
to have its origin in the malice that was harboured in the heart and
head of Dr Tshitereke’
(para 59 of the award).
44.2.
Secondly, the fact that Mr Mathebula came to
different conclusions in his first and second reports over the space
of two months
‘seems to support [Dr Mathoma’s] conspiracy
theory’ (para 60 of the award).
[45]
In essence, the commissioner found that the
disciplinary action against Dr Mathoma was devoid of merit as it was
a consequence of
a malicious action by Mr Tshitereke and the
conspiracy theory. It was submitted on behalf of Old Mutual that both
of these findings
are unreasonable, as they were reached without any
consideration of the material evidence that refute such a
proposition.
[46]
Collins
dictionary
defines a
conspiracy
theory
as ‘a belief that a group of people are secretly
trying
to
harm
someone
or
achieve
something’.
[12]
The term is usually used to
suggest
a
belief in the
likelihood
of
that happening.
In
the context of the present matter, Dr Mathoma’s evidence
attributed his dismissal to Dr Tshitekere, the lead conspirator,
and
Dr Mathoma’s subordinates, including Mr Hadebe. The
commissioner accepted this proposition as probable on the strength
of
the ‘Mathebula conflicting reports’. In my view, this
finding is untenable given the fact that the commissioner
failed to
consider Old Mutual’s evidence,
inter
alia
,
that:
46.1.
T
he
incidents that led to Dr Mathoma being charged with gross negligence
and dishonesty happened between 4 April 2011 and 20 December
2011. This was a period before Dr Tshitereke’s appointment in
January 2012, and months before the deterioration of the relationship
between Dr Mathoma and Dr Tshitereke in May 2012.
46.2.
The Mathebula reports dealt with the collective
grievance against Dr Mathoma. Nothing turns on the outcome of the
Mathebula reports
as the charges brought against Dr Mathoma flowed
from the GFS forensic report submitted on 25 October 2012.
46.3.
Mr Sonn’s evidence that the conspiracy
theory was far-fetched since Dr Tshitereke was a substantially more
junior employee
in rank and as such could not have influenced the
decisions of senior management.
[47]
In any event, the case against Dr Mathoma could
have been determined on the basis of the following objective facts
that were before
the commissioner:
47.1.
Dr Mathoma commissioned AfriWealth to
conduct the studies;
47.2.
He authored the AfriWealth agreement and the
emails to the finance department;
47.3.
He received and approved the reports and invoices
from AfriWealth; and
47.4.
He corrected and signed the minutes of the
GFS interview on 15 August 2012.
[48]
It is clear from the above that Dr Mathoma’s
conspiracy theory was implausible.
The commissioner’s
inconsistency finding is unreasonable
[49]
Old Mutual argued that the commissioner’s
finding of inconsistency in paragraphs 62 to 63 of his award is
patently unreasonable
because Dr Mathoma was not similarly situated
to Ms Zondo, because the charges against him far exceeded simply
concluding a contract
above his limit of authority as Ms Zondo had
done.
[50]
It the light of the commissioner finding Dr
Mathoma not guilty, it was not necessary to deal with the issue of
inconsistency. Nonetheless,
his finding is correct since Dr Mathoma’s
evidence in this regard was not disputed.
[51]
It is my view, however, that, given the
circumstances of this case, a finding of inconsistency in relation to
one element of a charge
of negligence could not have justified a
finding that the dismissal was substantively unfair. Dr Mathoma also
faced a charged of
dishonesty, a dismissible misconduct ordinarily.
The commissioner’s
findings of procedural unfairness are unreasonable
.
[52]
Old Mutual
argued that there was nothing wrong with Ms Christie not following a
two-stage process, involving separate hearings into
guilt and
sanction since the issue of penalty was explored during argument at
the disciplinary hearing and Dr Mathoma was at liberty
to advance his
mitigating factors at that stage. Furthermore, that Dr Mathoma was
afforded an appeal enquiry which, in a sense
cured the procedural
defects.
[13]
[53]
Conversely, Dr Mathoma argued that Old Mutual was
bound by its own Disciplinary Code. In this regard, his counsel
referred to the
Old Mutual Disciplinary Code, in particular Clauses
18 and 21. In terms of Clause 21, the mitigating factors have to be
addressed
only after a verdict of guilty and it is unfair for the
chairperson to decide the sanction before considering the mitigating
factors.
[54]
Old Mutual argued further that it is perverse for
the commissioner to have found that Ms Christie’s disclosure
that she was
going to give Mr Estie a lift gave rise to a perception
of bias. That, similarly, on a proper assessment of the facts, no
reasonable
perception of bias arose from the fact that Dr Mathoma did
not receive the findings simultaneously with the company having
received
them (in so far as this occurred) or from the fact that Ms
Christie corrected two minor errors in her findings at the request of
the Old Mutual.
[55]
Again, It was pointed out by Dr Mathoma’s
counsel that the above behaviour by the chairperson and Mr Estie
violated
Clause 18 which provides,
inter
alia,
that the chairperson must not be
biased; the case should not be discussed between the presenter and
chairperson apart from
necessary logistics; the
chairperson and the presenter should refrain from having any
discussions by themselves in
private as this creates a perception of
bias; The chairperson may not travel to and from an incomplete
enquiry in the same motor
vehicle as any other party involved in the
enquiry; and should these people be on the same flight, they may not
be seated in the
same immediate vicinity.
[56]
Whilst
it is trite that there are circumstances where it is acceptable for
the
audi
alteram partem
rule to be observed after the decision has been taken, in this
case,
[14]
Old Mutual failed to
lead evidence to show that the appeal was sufficiently fair as to
have the effect of curing the procedural
defects especially since
they are not merely technical. Dr Mathoma led evidence that he
was prejudiced since the appropriateness
of the sanction of dismissal
was determined without consideration of his mitigating
circumstances.
[15]
[57]
Pertinently,
the chairperson of the disciplinary enquiry must conduct the
proceedings in an impartial and fair manner and it must
be apparent
to the parties appearing before her/him especially the accused
employee.
[16]
[58]
In this case the conduct of
the chairperson in travelling with the prosecutor during the sitting
of the disciplinary enquiry and
communicating with Old Mutual after
submitting her ruling but before delivering it formally to the
applicant was not only inappropriate,
but is contrary to and
violated Old Mutual’s guidelines aimed at protecting the
integrity of the disciplinary procedure.
Therefore, Dr Mathoma’s
apprehension in this regard was reasonable.
[59]
The commissioner’s
finding on procedural fairness cannot be faulted and is accordingly
reasonable.
Conclusion and relief
[60]
In the premises, the commissioner’s finding
that Dr Mathoma was not guilty of gross negligence and dishonesty
is untenable and falls short of a
reasonable decision maker’s standard.
Even
though the finding of the commissioner on inconsistency cannot be
faulted, it is only limited to one aspect of the charge of
negligence
(the limit on authority to procure services) and as such does not
justify a finding that the dismissal was substantively
unfair.
[61]
The parties seek that the matter to be finally
determined by this Court. I now deal with the charges,
appropriateness of the sanction
and procedure.
Was Dr Mathoma guilty
of dishonesty?
[62]
As stated above, Dr Mathoma conceded under cross
examination that the contents of the second AfriWealth report had not
been changed
when he wrote both emails. When he was challenged on
this aspect during cross-examination this is how he fared:
‘
MR TODD: …So you
are telling Cheryl and Heidi that you had asked …Professor
Banjo to effect some changes in
the report, is that what you are
telling them?
MR [DR] MATHOMA: I had and as I
just explained that I, we were excited that Mrs Khandi and Professor
Banjo was going to work,
this was my understanding, … to do
cleaning up and also to do the finalisation of the structure to work
on the draft.
MR TODD: Shall we read the next
sentence Dr Mathoma? – I was not prepared to pay him until we
were happy with the entire report.
MR [DR] MATHOMA: Yes.
MR TODD: - Hence I wanted to …accrue
the money and pay him next year when he would have made changes. See
that?
MR [DR] MATHOMA: (Indistinct).
MR TODD: I am just continuing, this
follows – I was not prepared to pay him until we are happy with
the entire report have
I wanted to accrue the money to pay him next
year when he would have made changes. Do you see up to that part?
MR [DR] MATHOMA: Yes.
MR TODD: And then you say this –
He has now effected the changes and I am happy with them. - Do you
see that?
MR [DR] MATHOMA: Yes. I see that.
MR TODD: that was untrue Dr Mathoma.
MR [DR] MATHOMA : What?
MR TODD: That Professor Banjo has made
changes and that you were no happy with the changes.
MR [DR] MATHOMA: No That is not true.
It is not true and I do not agree with you.
MR TODD: it is false.
MR [DR] MATHOMA: It is not that is why
I say, you know, you have got to understand the context of how we get
(indistinct)
and this is me and my manager, after having
a discussion and then I became paid and said good procurement, what
we do in this kind
of situation, I would show later on also an email
where Heidi Kinciad was saying to me she is even worried because a
whole lot
of people who were not even implementing the procurement
policy…’
[63]
It is apparent from above that Dr Mathoma was
evasive in his responses and gave illogical explanations. In fact,
that is how he
conducted himself throughout his cross examination,
evasive and argumentative. Dr Mathoma authored both emails and what
he asserted
therein was false because at that time no changes had
been effected in the second AfriWealth report as it was ‘work
in progress’.
[64]
I am convinced that Dr Mathoma’s conduct
was deceitful.
Was Dr Mathoma guilty
of Gross Negligence?
[65]
The crux of Old Mutual’s negligence charge
is summarised in the following proposition put to Dr Mathoma during
his cross examination:
‘
We say that you conducted
yourself, in fact it is generous to you to say it was grossly
negligent, when you engaged Afriwealth,
in the way that you engaged
them, where you paid them, in the way that you paid them. In
approving the invoices that you
approved for them, in accepting that
this work in these two reports constituted or met the requirements
that you had set.’
[66]
Old Mutual mainly relied on the evidence of Ms
Meijer and Mr Venter who conducted an interview with Dr Mathoma on
15 August
2012 as part of GFS investigation. Dr Mathoma disputed
the accuracy of the said interview.
[67]
Ms Meijer and Mr Venter corroborated each other
regarding issues that were addressed with Dr Mathoma on 15 August
2012 and the accuracy
of the minutes. Mr Venter testified that on 17
August 2012 he took the minutes of the said interview to Dr Mathoma
who read them,
made written corrections and then signed. He was
adamant under cross-examination that Dr Mathoma was alone in his
office when he
handed him the minutes.
[68]
Dr Mathoma, on the other hand, insisted that the
minutes were not a correct reflection of the interview. He denied
that he made
the following pertinent admissions:
‘
Dr Mathoma agreed that he did
not follow the proper procurement process according to the Old Mutual
procurement policy purely because
of an oversight on his part and
pressure to deliver.
Anneli Meijer asked Dr Mathoma if he
took time to himself to read the two documents that is the AfriWealth
reports and Dr Mathoma
responded that he needs to agree that the
research document was of poor quality and that he was not vigilant
enough the ensure
the research was properly conducted and reported on
before payments were made.’
[69]
Under cross-examination, confronted with his
version of defence at the disciplinary enquiry that the reason he did
not engage the
legal department to assist in the drafting of the
AfriWealth agreement was because he was overstretched at the time, Dr
Mathoma
mumbled and evasively stated that ‘I did not say that I
am overstretched I said these are other things that I am doing’.
That version is clearly consistent with Ms Meijer and Ms Venter’s
evidence of what he had said during the interview on 15 August
2012.
[70]
On the circumstances surrounding his signing of
the minutes of the interview on 17 August 2012, as stated above,
Dr Mathoma,
conceded making handwritten amendments on the very page
on which the two damaging statements allegedly made by him are
recorded.
He also conceded that his version that he signed the
minutes under pressure from Mr Ralebitso was different to a version
he gave
at the disciplinary enquiry.
[71]
Ms Meijer and Ms Venter’s evidence is
further corroborated by the following objective facts:
71.1.
The AfriWealth agreement,
ex
facie
, states the terms of engagement and the
expected outcomes from studies. Dr Mathoma conceded that the reports
did not cover his
desired outcome. He also conceded that the reports
were of poor quality but was expecting Professor Banjo and Dr
Tshitereke to
work on the drafts. This version on defence is novel
and stands to be rejected. Professor Banjo’s evidence at the
disciplinary
enquiry was that after submitting the reports he
expected Dr Mathoma to revert back to him if he had problems with the
content
of the reports and that never happened.
71.2.
Dr Mathoma authorised payment of AfriWealth’s
first invoice on 31 August 2011 but only received the report on 12
September
2011. Typically, Dr Mathoma approved payment for services
he was yet to receive and as such could not have satisfied himself
that
the outcome was commensurate with the money expended. The second
AfriWealth invoice was approved and paid despite the substandard
report.
71.3.
The second AfriWealth invoice reflects a
breakdown of service and computation of hours’ work. It showed
that Professor Banjo
and his assistants worked 24 hours per day over
a period of 90 days in order to justify a cost of R400 000. Dr
Mathoma conceded
that AfriWealth’s calculations were illogical
but he approved the payment, after consulting with Mr Ralebitso,
because he
was excited to work with Professor Banjo and was expecting
to have a long term relationship.
[72]
Following the above, Dr
Mathoma’s credibility as a witness was seriously dented. He
failed to take responsibility for manner
in which he procured
services of AfriWealth; approved payment of their invoices and
accepted their reports despite being of substandard
quality and did
not address the issues they were contracted to cover. Probabilities
show that Dr Mathoma failed to meet the requisite standard
of
care expected of him as a senior manager.
[73]
In
National
Union of Mineworkers on behalf of Botsane v Anglo Platinum Mine
(Rustenburg Section),
[17]
the
LAC, dealing with gross negligence of a senior manager, stated the
following:
‘
[20]
The appellant’s stance in denying culpability for gross
negligence betrays a lack of grasp about
the nature of his job. He
was a manager and was responsible to manage the programme of
fitment. To this end …he failed
to properly apply his mind.
Despite the acknowledgement in his testimony that he was required to
use judgment, he failed to do
so. An inappropriate combination of
ignorance of the hard facts that he needed to manage effectively and
an undue deference to
feedback he knew to be unreliable demonstrates
his lack of judgment.’
[74]
As addressed more fully
elsewhere, I am satisfied that Dr Mathoma was grossly negligent.
Was dismissal an
appropriate sanction?
[75]
On appropriateness of the sanction of dismissal,
I considered the seriousness of the misconduct of gross negligence
and dishonesty
and that ordinarily they are dismissible
transgressions. Additionally, I looked at the following mitigating
and aggravating circumstances:
75.1.
Evidence in mitigation indicates that Dr Mathoma
was a good and loyal employee with a clean disciplinary record, he
saved Old Mutual
large sums of money, he performed carious tasks for
the Head Office; he had received number of commendations from
dignitaries such
as Mr Reolf Meyer and Minister Lindiwe Sisulu, he
continued assisting his former colleagues even after his dismissal.
75.2.
Old Mutual,
on the other hand, argued that Dr Mathoma accepted under
cross-examination that if he was found guilty of the charges
brought
against him dismissal would be an appropriate sanction; he was a
senior manager employed in the financial service sector;
he displayed
no remorse whatsoever;
[18]
he
gave false evidence at the arbitration;
[19]
and provided contradictory explanations in his evidence. Mr Sonn
testified also that Dr Mathoma could not be trusted and relied
upon
to operate at the level of a Group Manager.
[76]
In
Fort
,
[20]
addressing the trust issue, the LAC stated the following:
“
[97]
In
Shoprite
Checkers (Pty) Ltd v Commission for Conciliation, Mediation
and
Arbitration
and
others,
[21]
this
Court restated the consistently adopted approach, laid down in the
jurisprudence of the Labour Court in
Standard
Bank SA Ltd v CCMA
and
others
[22]
to the
effect that it is
one
of the fundamentals of the employment relationship that the employer
should be able to place trust in their employees to discharge
their
responsibilities dutifully. A breach of this trust in the form of
conduct involving dishonesty, as in this case, is one that
goes to
the heart of the employment relationship and is destructive of it.
The sanction of dismissal must be seen as a sensible
operational
response to risk management in the particular enterprise
.’
[Emphasis added].
[77]
Old Mutual, operating within the financial
service sector, is not unreasonable in expecting its senior manager
to exercise a high
standard of care and to demonstrate utmost good
faith in dealings. I am convinced that dismissal is an appropriate
sanction.
Procedural Fairness
[78]
On
procedural fairness, having found that the commissioner’s
finding in this regard was beyond reproach, I am of the view
that a
compensation of three months’ salary is just and equitable,
having
considered
that Dr Mathoma was dismissed for serious charges (gross negligence
and dishonesty) and the extent of the procedural
defect (mitigation
and perception of biasness).
[23]
Costs
[79]
With regard to costs, since both parties
partially succeeded, it is reasonable that each party
pays its own costs.
Order
[80]
In the premises, I make the following order:
1.
The arbitration award
issued under CCMA case number GAJB9810-13 is reviewed and
set aside and replaced
with the following order:
1.2. The dismissal of Dr
Mathoma is substantively fair but procedurally unfair.
1.2. Old Mutual is
ordered pay the applicant a compensation equivalent to three months’
salary to be paid within one month
from the date of this judgment.
2.
There is no order as to costs.
____________________
P. Nkutha-
Nkontwana
Judge
of the Labour Court of South Africa
Appearances:
For the
applicant:
Advocate Anton Myburgh SC
Instructed
by:
Bowman Gilfillan
For the third
respondent:
Advocate F Snyman
Instructed
by:
Dirk Fourie Attorneys
[1]
Act 66 of 1995 as
amended.
[2]
[2012]
11 BLLR 1074
(SCA).
At
para 13 the court stated that “…The
Sidumo
test will, however, justify setting aside an award on review if the
decision is 'entirely disconnected with the evidence' or
is
'unsupported by any evidence' and involves speculation by the
commissioner.”
[3]
[2014]
1 BLLR 20 (LAC).
[4]
[2015]
5 BLLR 484
(LAC); (2015) 36 ILJ 1511 (LAC) at para 16.
[5]
[2014]
ZALAC 50
;
[2015] 1 BLLR 50
(LAC) at paras 30-32.
[6]
[2017] ZALAC 50
at para 51.
[7]
2003
(1) SACR 35
(SCA) at 41 para 9.
[8]
See
also
National
Union of Mineworkers
and
Another
v Commission for Conciliation, Mediation
and
Arbitration
and
Others
referred
to by the Court
(2015)
36 ILJ 2038 (LAC) at 2044 -2045 para 14.
[9]
Stocks Civil
Engineering (Pty) Ltd v Rip NO and another
[2002]
3 BLLR 189
(LAC) at para 92.
[10]
SA
Nylon Printers (Pty) Ltd v Davids
[1998] 2 BLLR
135
(LAC) at 137I-138A;
Absa
Brokers (Pty) Ltd v Moshoana NO and others
[2005]
10 BLLR 939
(LAC) at paras 38-42 and
Southern
Sun Hotel Interests (Pty) Ltd v CCMA and Others
(2010) 31 ILJ 452 (LC) at 462 para 20.
[11]
Tao
Ying metal Industry (Pty) Ltd v Pooe NO and others
[2007]
7 BLLR 583
(SCA) at para 45.
[12]
https://www.collinsdictionary.com/dictionary/english/conspiracy-theory
[13]
See
generally,
Slagment
(Pty) Ltd v Building Construction and Allied Workers Union and
others
(1994)
15 ILJ 979 (A) at 992A-I.
[14]
Cabinet for
the Territory of South West Africa v Chikane
1989 (1) SA 349
(A) at 379 FG and in
Administrator
Transvaal and others v Traub and others
1989
(4) 8A 731(A) at748 GI and 750 BF;
Slagment
(Pty) Ltd v Building Construction and Allied Workers Union
(1994) 15 ILJ 979 (A) at 992 A–I;
Nasionale
Parkeraad v Terblanche
(1999) 20 ILJ 1520 (LAC) at paragraphs 10–14;
Jerry’s
Security Services CC v CCMA and others
[2001] 7 BLLR 751 (LC);
[15]
Rand
Water Board v CCMA (2005) 26 ILJ 2028 (LC) at 2032.
[16]
President
of the Republic of South Africa and others v South African Rugby
Football Union and others
[1999] ZACC 9
;
1999 (4) SA 147
(CC) para 48;
SACCAWU
v Irvin & Johnson Ltd (Seafoods Division Fish Processing)
[2000] ZACC 10
; 2000 (3) ) [2000] ZACC 10; 2000 (3) SA 705 (CC).
[17]
[2014] ZALAC 24
;
(2014) 35 ILJ 2406 (LAC) at para 20.
[18]
Theewaterskloof
Municipality v SA Local Government Bargaining Council (Western Cape
Division)
and
others
(2010)
31 ILJ 2475 (LC) at para 27 – 29.
[19]
Leonard
Dingler (Pty) Ltd Ngwenya
(1999)
20 ILJ 1171 (LAC) at para 78;
De
Beers Consolidated Mines Ltd v CCMA
and
others
(2000)
21 ILJ 1051 (LAC) at para 25.
[20]
Above n 8 at para
97.
[21]
(2008)
29 ILJ 2581 (LAC) at 2585 para 16.
[22]
(1998)
19 ILJ 903 (LC).
[23]
Johannesburg
City Parks Ltd v Toli NO and Others
(2012)
33 ILJ 1456 (LC) at para 14.