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[2017] ZALCD 10
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Harris v Msunduzi Municipality and Others (D1101/13) [2017] ZALCD 10 (20 April 2017)
IN THE LABOUR COURT OF
SOUTH AFRICA
(HELD IN DURBAN)
Reportable
CASE
NO. D1101/13
In
the matter between:
TYRONE
NEILMORGAN HARRIS
Applicant
and
MSUNDUZI
MUNICIPALITY
First Respondent
COMMISSIONER
V SONI N.O.
Second Respondent
THE
SOUTH AFRICAN LOCAL
GOVERNMENT
BARGAINING COUNCIL
(SALGBC)
Third Respondent
Heard:
01 February 2017
Delivered:
20 April 2017
Summary:
Review of compensatory award – travelling allowance -
irregularities
or errors in relation to the facts or issues may produce an
unreasonable outcome –
compensation
in terms of s194 to be morally right and fair,
if not award reviewable -
misdirection committed by commissioner - t
he
result is compensation which is way out of proportion with the amount
spent by the Applicant for work purposes - award reviewed
and
corrected.
JUDGMENT
CELE J
Introduction
[1]
This is an application for the review and correction of the
arbitration award issued in this matter by the Second Respondent
and
it is based on section 145 (2) of the Labour Relations Act.
[1]
In terms of the award, the Second Respondent found that the First
Respondent committed an unfair labour practice against the Applicant
and awarded compensation to the Applicant in the amount of R25
146-00. The Applicant does not seek the review of the entire award,
but seeks to review the finding of the Second Respondent relating to
the quantum of compensation awarded and her failure to award
legal
costs of the arbitration to the Applicant. The review application was
filed late. Condonation was sought for such lateness
and it was
granted at the hearing of the application. The First Respondent
belatedly opposed the review application and sought
condonation for
such lateness. Condonation was also granted at the hearing of the
matter.
Factual Background
[2] Most of the facts in
this matter remained common cause between the parties. The Applicant
was in the employment of the First
Respondent since 1 December 2003
in the position of a Science Inspector earning R12 000-00 per month
at times material to this
matter. His duties entailed the policing of
the Municipal area to ensure compliance with municipal by-laws. He
had therefore to
do a lot of field work, for instance by visiting
private properties. To that end he was furnished with a council motor
vehicle
to use for such travelling and he kept a logbook registering
monthly kilometres he travelled. Out of the regular use of the
council motor vehicle its condition deteriorated to the point of
being not road worthy. He reported the poor condition of this
motor
vehicle to his supervisor Mr L Muller and the motor vehicle was
finally taken out of the road sometime in October 2007.
[3] The First Respondent
had a locomotion policy scheme for its employees with three facets.
One of those was the running travel
allowance with acronym RTA, in
terms of which employees could then be reimbursed for the cost of the
use of their motor vehicles
for work purposes. In the absence of a
council motor vehicle the Applicant said that he used his private
motor vehicle for work
purposes from October 2007 onwards. In
February 2010 the Applicant discussed with Mr Muller about him buying
his motor vehicle,
use it for work purposes and claim under the RTA.
Mr Muller agreed with the proposal and to that extent issues a letter
to the
Applicant to facilitate the purchasing of that motor vehicle
as it disclosed that if he bought it he would be entitled to the
locomotion
allowance. He bought himself a Nissan bakkie which he said
in evidence he used for work purposes.
[4] On 16 February 2010
the Applicant completed and submitted his application forms for the
locomotion allowance and handed them
to Mr Muller who recommended the
granting of the allowance and passed the application forms on to Mr
Vishad Jadoo, a clerk
in Mr Muller’s section. Mr Jadoo made
copies of Applicant’s mileage book and transmitted the
application with copies
of the mileage to Ms Roshni Padayachee in the
Finance Department for further processing. Ms Padayachee processed
the application
and forwarded it to the department of internal audit
who were to check and if satisfied that all requirements were
complied with,
would then sign the application and return it to Ms
Padayachee for onward transmission to the Chief Financial Officer
(CFO) for
final approval authorizing the Pay Office to pay a claim in
terms of that allowance.
[5] Once the application
was in the department of internal audit it was found that all
application supporting schedules were attached
to the application
except the 6 months mileage information required for the approval of
the allowance and a query was noted. What
then was required was to
obtain the 6 months mileage. In the event such information for
whatever reason could not be furnished,
a written motivation had to
be furnished by the line manager, Mr Muller and a Strategic Manager.
In the instant case Mr Muller
had supported the application by
recommending that the payment of the allowance be authorized.
[6] Because of the query
raised by internal auditors the payment of the allowance was never
authorized. A stalemate was reached
as the Applicant, supported by Mr
Muller contended that the 6 months mileage had been supplied and
attached to the application
but Ms Padayachee disputed the assertion.
The Applicant, aggrieved by the turn of events, lodged a grievance
and when it could
not successfully be resolved, he referred an unfair
labour practice dispute relating to the provision of benefits for
conciliation
and later for arbitration.
Arbitration
[7]
The First Respondent objected to the jurisdiction of the third
Respondent by contending that the participation in the travelling
allowance was not a benefit as envisaged in section 186 (2) (a) of
the LRA. The submission was that in terms of the allowance,
employees
were reimbursed for the cost of the use of their motor vehicles for
work purposes and that they had to meet the set requirements
of the
policy. Relying on Apollo Tyres South Africa (Pty) (Ltd) v CCMA &
Others,
[2]
the Second Respondent
correctly dismissed the point
in
limine
raised and found that the transport allowance was a benefit as
envisaged in the LRA.
[8]
Essentially two factual disputes were contested by the parties. The
first turned on whether the Applicant was at all material
times
supplied with a council motor vehicle to use and if so, whether he
was entitled to claim the allowance. The second issue
was whether the
6 months mileage records were submitted as part of the application
supporting schedules. The first issue was easily
resolved as
witnesses of the First Respondent conceded that the Applicant
qualified for the allowance. The 6 months mileage records
issue was
resolved in favour of the Applicant. The probabilities of the matter
favoured that approach. If the mileage documents
were not supplied at
all, Ms Padayachee would be the first to query the application. She
did not and instead she forwarded the
application for further
processing by the internal audit department. These documents must
have been lost between her office and
that of the internal audit. The
First Respondent has not even filed a counter-review application and
therefore these findings are
not being challenged. As already alluded
to, the Applicant only seeks to review the findings of the Second
Respondent relating
to the quantum of compensation awarded and the
failure of the Second Respondent to award legal costs of the
arbitration to the
Applicant.
The computation of
compensation
[9]
Evidence of the Applicant is that had the First Respondent approved
the Applicant’s application for a travel allowance
in 2010, the
Applicant would have been entitled to claim a reimbursement of his
travel costs at the rate of R4-191 per kilometer
traveled, or R4
191-00 per 1000 km traveled. As confirmed by his immediate
supervisor, Mr Muller Applicant would have traveled
in excess of the
set minimum of 300 km each month for the purposes of business travel.
The Second Respondent found that it was
undisputed that the Applicant
would have travelled beyond the average mileage requirement. In terms
of the policy the employee
would be paid for the actual kilometres
travelled, if such was less than 1000 km in a month. If the distance
travelled was more
than 1000 km per month, 1000 km would be paid for
as the maximum.
[10]
The total number of leave days taken by the Applicant from 01 April
2010 to 27 August 2013 as provided at arbitration by the
First
Respondent amounted to 267 days. After removing non-work days (public
holidays and weekends) in the period 01 April 2010
to 27 August 2013,
the number of work days left was 875. The Applicant said that he
would have been present at work and traveling
for work purposes for a
period of 875 days – 267 days = 608 days. In order to calculate
the total allowance owing to the
Applicant, the Applicant said one is
required to multiply the total number of days by the travel allowance
per day. The average
number of working days in a month in the Local
Government Sector is 21.74.
[3]
The Applicant said that the total daily cost of the monthly allowance
was R4 191-00 divided by 21.74, which amounts to R192-78
per day.
Therefore, the total allowance owed to him, he said, amounted to 608
X R192-78 = R117 210-74. This calculation was provided
to the
arbitrator by agreement between the parties, and was contained in the
Applicant’s Heads at Arbitration.
[11]
The Applicant
submitted
that the calculation of R117 210-74 was clear, fairly simple to
understand and could be considered to be the loss suffered
by the
Applicant at the hands of the First Respondent in terms of the unfair
labour practice. He averred that it was to be expected
that
compensation which was just and equitable, would take this
calculation into account above everything else. He said that nothing
would be more just and equitable than attempting to place the
Applicant in the financial position he would have been in had he
not
been unfairly treated. Instead, the arbitrator awarded compensation
in the amount of R25 146-00, being the equivalent of 6-months
of
travel allowance. The submission was that compensation was arrived at
arbitrarily, because there is no rational basis for it,
particularly
after the calculation above was submitted for the consideration of
the arbitrator. There is no evidence tendered by
the First Respondent
which explained a different basis for calculation as the position
taken was that the Applicant was not entitled
to any payment. The
arbitrator did not raise any issues with the calculation itself, but
instead raised other issues. As correctly
summarized by the
Applicant, the Second Respondent, inter alia, found that:
1
The Applicant was assaulted by a senior manager in his department as
a result of the fact that he was reluctant to utilize his own,
unsubsidized, transport to perform his duties.
2
The Applicant was forced to use his own vehicle, which rendered him
out
of pocket.
3
Labour law was based on social justice and there is no justice if the
Applicant is not compensated.
4
She had to consider compensation on the basis of the unfairness
committed
and the amount that he would have received on a monthly
basis saying that: “
Advocate
Moodley estimated the amount to be R117 210-00, after taking into
account all forms of leave and non-attendance at work.
”
[4]
5
She was guided by the breakdown furnished by Advocate Moodley.
6
The Applicant used his own vehicle for many years, which enriched the
Respondent and impoverished him.
7.
She could not grant compensation to be in line with the payment that
the
Applicant would have received, as that calculation was in excess
of the statutory 12-month period.
8.
She found that 6-month’s compensation based on his average
allowance would
be fair, in considering the fact that the Applicant
sometimes used the Respondent’s vehicle and stayed away due to
illness.
9.
In any event, compensation was vastly different from a reimbursement
claim.
10.
She did not believe that it is fair to award the maximum
compensation, as the Applicant
was not fault-free. If at any stage he
took the initiative to keep a proper logbook, he would have been
entitled to back pay of
the allowance.
[12]
The Applicant averred that the Second Respondent committed a gross
irregularity or misconduct in that she:
Ø
Wrongly
believed that the quantum of compensation of R117 210 claimed by the
Applicant exceeded the salary limit of 12 months when
it was common
cause that the Applicant earned R12 000 per month, equal to 144 000
per annum;
Ø
Held
that the Applicant sometimes used the council vehicle and stayed away
due to illness when in fact there was no evidence that
the Applicant
used council vehicle at any time from 2010, instead there is evidence
that he did not;
Ø
Considered
sick leave taken by the Applicant when such sick leave taken had
already been factored in the figures given to her and
therefore cause
sick leave period to be deducted twice;
Ø
Was
at odds with her earlier finding when she stated that the Applicant
ought to have kept a logbook. She had already correctly
stated that
in any event, the reason that the Applicant did not keep the travel
logbook was because his travel allowance was never
approved. He was
not being obstructive or uncooperative.
[13] According to the
First Respondent the decision of the Second Respondent was not
reviewable essentially on the bases that:
v
The
decision is not obviously wrong, as even if there are alternative
decisions which the Second Respondent could have made which
would
have been reasonable, the decision which the Second Respondent did
arrive at is not outside the range of reasonableness;
v
The
Second Respondent, in determining the issues before her, was not
determining a question of law, but was called on to make a
decision
involving a judicial discretion. As such, the Second Respondent was
determining a question which involved the determination
of what is
right, just, equitable and reasonable. She accordingly was called
upon to exercise a moral or value judgement;
v
There
is no error or misdirection on the part of the Commissioner which
caused the unsuccessful party to lose the arbitration. The
arbitrator
did not misconceive the nature of the enquiry, nor can it be said
that she committed any material error or irregularity
in relation to
the result of the arbitration;
v
The
arbitrator correctly understood the nature of the enquiry which she
was required to undertake. The arbitrator was confronted
with a
situation in which she had to make the best of the material which was
available to her. It is apparent that the arbitrator
approached the
situation correctly.
Evaluation
[14]
The law governing the test for review is trite. As set out in
Sidumo
and another v Rustenberg Platinum Mines Ltd and others
,
[5]
the
Constitutional Court held that:
“
[106]
…. Section 33(1) of the Constitution presently states that
everyone has the right to administrative action
that is lawful,
reasonable and procedurally fair. The reasonableness standard should
now suffuse section 145 of the LRA.
[107] The
reasonableness standard was dealt with in
Bato
Star
.
In the context of section 6(2) (h) of PAJA 3 of 2000, O`Regan J said
the following :”(A) n administrative decision will
be
reviewable if, in Lord Cooke`s words, it is one that a reasonable
decision-maker could not reach”.
[108] This
Court recognised that scrutiny of a decision based on reasonableness
introduced a substantive ingredient into review
proceedings. In
judging a decision for reasonableness, it is often impossible to
separate the merits from scrutiny. However, the
distinction between
appeals and reviews continues to be significant.
[109]
Review for reasonableness, as explained by Professor Hoexter, does
threaten the distinction between review and
appeal. The Labour Court
in reviewing the awards of commissioners inevitably deals with the
merits of the matter. This does tend
to blur the distinction between
appeal and review. She points out that it does so in the limited
sense that it necessarily entails
scrutiny of the merits of
administrative decisions. She states that the danger lies, not in
careful scrutiny, but in “judicial
overzealousness in setting
aside administrative decisions that do not coincide with the judge`s
own opinions. “This court
in
Bato
Star
recognised
that danger. A judge`s task is to ensure that the decisions taken by
administrative agencies fall within the bounds of
reasonableness as
required by the Constitution”
.
[15]
The test for review is then whether the decision reached by the
Commissioner is one that a reasonable decision maker could
not reach.
In
Fidelity
Cash Management Service v CCMA
,
[6]
per Zondo JP (as he then was) at paragraph 102, the Labour Appeal
Court stated in relation to the Sidumo test:
“…
there
can be no doubt now under Sidumo that the reasonableness or otherwise
of a commissioner’s decision does not depend –
at least
solely – upon the reasons that the commissioner gives for the
decision. In many cases the reasons which the commissioner
gives for
his decision, finding or award will play role in the subsequent
assessment of whether or not such decision or finding
is one that a
reasonable decision-maker could or could not reach. However, other
reasons upon which the commissioner did not rely
to support his or
her decision or finding but which can render the decision reasonable
or unreasonable can be taken into account.”
[16]
The
threshold as to when a decision might be set aside on review was
dealt with by Murphy AJA in
Head
of Department of Education v Mofokeng and others
,
[7]
a decision relied on by Mr Dutton for the First Respondent, where it
was held that:
“
Irregularities or errors in
relation to the facts or issues, therefore, may or may not produce an
unreasonable outcome or provide
a compelling indication that the
arbitrator misconceived the enquiry. In the final analysis, it will
depend on the materiality
of the error or irregularity and its
relation to the result
.”…
[8]
[17] Clearly therefore,
irregularities or errors in relation to the facts or issues,
therefore, may or may not produce an unreasonable
outcome. With all
these legal principles referred to above in mind, the application has
now to be considered. In this application
Court has to deal with
a
question of judicial discretion as opposed to one of law as the
Applicant only takes issue with the quantum of the compensation
awarded by the Second Respondent to him and the failure to award
legal costs in his favour. This involves issues as to what is
right,
just, equitable or reasonable, except so far as determined by law. In
terms of section 194 (4) of the LRA compensation granted
by an
arbitrator must be just and equitable in all the circumstances, but
must not be more than the equivalent of 12-month’s
remuneration
of the employee. As correctly submitted by the Applicant and
according to the Oxford Dictionary, the word “just”
means
“morally right or fair”. The same dictionary defines the
word “equitable” as “fair and impartial”.
Therefore, the phrase used by the legislature in section194 (4) of
the LRA must mean that an arbitrator must award compensation
which is
morally right and fair. Should an arbitrator not award compensation
on this basis, such an award might therefore be reviewable
on the
basis that no other reasonable arbitrator could have made such an
award.
[18]
The Second Respondent appears, as contended by Mr Moodley, appearing
for the Applicant, to have relied on the calculation provided
to her
by the Applicant to arrive at the amount of R25 160-00 (21.74 days X
6 months X R192-78 = R25 146-22). She simply used the
calculation as
correct, but reduced the period of the loss from 608 days to 6
months, or 130 days. This indeed does imply that
she had no problem
with the calculation, by which she admitted she was guided, but
failed to extend the period of the loss suffered
by the Applicant to
more than 6 months. In fact the period of loss was from 01 April 2010
to 27 August 2013, a period of 41 months.
The R25 160-00 she awarded
as compensation is 79% less than the estimate provided to her by the
Applicant.
[19] In terms of section
194 of the LRA the highest amount of compensation she could award is
twelve months of his salary, which
is R144 000-00. Six months of that
compensation is R72 000-00. The Commissioner committed no defect when
she used the formula for
the determination of the allowance payable
but clearly misdirected herself when she considered the applicable
perimeters. The result
of that misdirection was an award which was
way out of proportion with the amount spent by the Applicant for work
purposes. The
R25 610-00 was clearly out of kilter when compared with
the amount of the undue enrichment in favour of the First Respondent
for
services rendered. The second consideration relates to the issue
of the sick leave. Again here, the Commissioner allowed a deduction
of the sick leave twice with no justifiable reason. She clearly
committed an arithmetic error which had serious effect on the
computation of a fair and just amount of compensation.
[20]
On the issue that the Applicant sometimes used the council vehicle,
the Commissioner was faced with two contradicting versions.
According
to the Applicant he never used a council vehicle in 2010 and yet
according to Mr Galus Rangan, the Pool Controller, the
Applicant was
provided with a pool vehicle. The Commissioner had the duty to
resolve this disparity in evidence. She found the
Applicant to have
been an honest witness whose version found support in that of his
line manager. The probabilities favoured the
acceptance of the
version of the Applicant, taking also into consideration that tussle
he was involved in with one of the other
managers who forced him to
get on with his duties.
[21] There is then the
issue of having to keep a mileage record. What the Commissioner first
did, in my view properly so, was to
determine whether the Applicant
had any legal duty to keep a record of mileage he travelled and she
found that he did not have
to as the allowance had to been approved
for him. The Commissioner had then to consider evidence of advice
given by Mr Muller to
the Applicant. The Applicant was advised to
keep a record of kilometres he had travelled for work purposes, if he
was later to
claim for the same. That was sound advice as it would
have formulated real or direct evidence to calculate the extent of
his loss.
The failure to heed that advice had the effect that
circumstantial evidence became necessary to compute his claim. I am
unable
to find any misdirection or fault on this way of reasoning.
[22] In conclusion, the
Applicant has successfully demonstrated that the basis for the
computation of his compensation was erroneously
done resulting in an
unfair and unjust award. The claim is for expenses that were actually
incurred in the execution of council
work. Compensation to be fair
and just should come close to the amount spent by the Applicant, even
when one takes into account
a failure to keep the actual record.
While Mr Muller spoke of 1000.00 km that the Applicant could have
travelled, he did not know,
nor could he have known the exact
distance. That explains his reference to figures such as 600 to 800
km per month. I am of the
view that had the Second Respondent not
committed the identified defects she would most probably have found
that three quarters
of the claimed amount was in the circumstances
just and fair. That amount comes to R87 908, when rounded up. In a
matter where
most of the evidence favoured the Applicant throughout
the arbitration hearing, it is difficult to understand why the costs
order
should not have followed the results. In this application as
well, I see no reason why the costs order should not be determined
by
the results of the application.
[23] I therefore issue
the order in the following terms:
1.
Paragraph
2 of the arbitration award in this matter is reviewed and corrected
to read: The Applicant is entitled to compensation
in the amount of
R87 908 to be paid to him by the First Respondent.
2.
The
First Respondent is ordered to pay all expenses incurred in the
arbitration hearing of this matter.
3.
The
first respondent is ordered to pay costs of this application.
__________
Cele
J.
Judge
of the Labour Court of South Africa.
APPEARANCES:
FOR THE APPLICANT: Adv. S
Moodley
INSTRUCTED
BY Narain Naidoo and Associates.
FOR THE FIRST RESPONDENT:
Adv. L T Dutton
INSTRUCTED
BY Mdledle Incorporated Attorneys.
[1]
Act
Number 66 of 1995, as amended (the LRA).
[2]
[2013] 5 BLLR 434
(LAC).
[3]
(South African
Local Government Bargaining Council: Main Collective Agreement)
[4]
See paragraph 54
of the award.
[5]
(2007) 28 ILJ 2405
(CC).
[6]
(2008) 29 ILJ 964
(LAC) para 102.
[7]
(2015) 36 ILJ 2802 (LAC) (Mofokeng)
[8]
At para 33.