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[2018] ZALCJHB 37
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Agricultural Research Council v Commission for Conciliation, Mediation and Arbitration and Others (JR2548/15) [2018] ZALCJHB 37; (2018) 39 ILJ 1297 (LC) (31 January 2018)
THE
LABOUR COURT OF SOUTH AFRICA, JOHANNESBURG
Not
Reportable
Case
no: JR 2548/15
In
the matter between:
THE
AGRICULTURAL RESEARCH
COUCIL
Applicant
and
COMMISSION
FOR CONCILIATION
MEDIATION
AND ARBITRATION
First
Respondent
WILLEM
KOEKEMOER
MOHAMED
SAYED JEENAH
Second Respondent
Third
Respondent
Heard:
30 August 2017
Delivered:
31 January 2018
Summary:
Summary: Review of an award –
legitimate and reasonable expectation for the renewal of a fixed term
employment contract –
primary issue is whether there is
dismissal and the issue is jurisdictional in nature – test is
whether the decision of the
Co
mmissioner
is correct or wrong – applicant erroneously relied on a section
145 review test – review dismissed
.
JUDGMENT
CELE
J
Introduction
[1]
The Applicant seeks an order to have the award issued by the Second
Respondent, the Commissioner, on the 3 December 2015 under
case
number GATW 8045/ 2015 reviewed and set aside in terms of section 145
of the Labour Relation Act
[1]
.
The Third Respondent opposes the application and simultaneously seeks
to have the award made an order of Court in terms of section
158 (1)
(c) of the LRA.
Factual
Background
[2]
The Third Respondent began his employment with the Applicant in 2008
when he signed a five year fixed term contract of employment
for the
position of Executive Director: Research and Development on 1
December 2008 but he started working on 1 February 2009
. C
lause
2.3 of his fixed term contract provided that
:
“
irrespective
of the last date of signature in this agreement, this agreement will
be effective and will be deemed to have commenced
on 1 December 2008
for a fixed period of five years or until terminated prior to the
expiry date on written notice by
either party in accordance with the
termination provisions of this agreement.”
[3]
The Applicant underwent an organisational restructuring in 2013 and
it was finalized in February 2014. The effect of the change
to the
third respondent was that his position was split into three Group
Executive posts being of Crop Science, Animal Science
as well as
Research and Innovation Support (RIS). A number of senior managers
and executives were placed into positions on the
basis that the job
specifications had not changed substantially. The Applicant made
re-assurances that no one would lose their
jobs as a result of the
restructuring.
[4]
The
positions
for
the
restructured
posts
were
advertised
and
the
Third
Respondent applied only
for
the RIS
position
but he was not successful
.
The Crop Science and Animal Science posts
were not
filled
and
the
Third Respondent did
not
apply
for either one of those posts. At the time, the Third Respondent's
expectation was that he
would
continue his employment
with
the Applicant
as
he had been doing the work and the position
was simply split into
three posts.
[5]
In November
2013,
the Third
Respondent
received a
three
months’
notice
of
non-renewal
of
his
five
years’
contract
that
was
to
terminate on 31
January 2014
.
However,
on
22
January
2014,
prior
to
the
expiry
of
the
three
months' notice,
the
Third
Respondent received
a
letter
that his
contract
would
be
extended for two
months
until 31 March 2014
.
[6]
On 31 March 2014 the Third Respondent received an offer of employment
for Acting Group Executive Director: Crop Science for
one year
starting on 1 April 2014 to 31 March 2015. He accepted the offer. He
did not challenge the termination of the initial
five year contract.
Therefore the Third Respondent has never made any timeous referral
for an unfair dismissal relating to this
period. In any subsequent
challenge to the fairness of the termination of his contract of
employment, this period should be left
out of consideration. In any
event the Third Respondent said in evidence that the one year
extension met his expectation. The one
year contract stipulated,
inter alia, that:
"
2…4
Although
the
ARC may
review the
Employees
contract
nearer the
expiry
date
,
it
is
specifically recorded that
there
is
no
expectation
that
the
Employees
contract
will be
renewed
for
a
period
other
than
the
one
envisaged
in
clause
2.3
above.
The termination
of
this
agreement
shall
not
constitute
a
retrenchment,
but shall be
the natural
completion
or fulfilment
of
the
contract.
"
[7]
He entered into a performance contract with the Applicant for the one
year contract which also stated that:
"
This
agreement shall
commence
on 1April 2014 and
continue
until 31
March
2015
and
thereafter
for
the
duration
of
the
employment contract."
[8]
Under the
renewed
contract,
the
Third
Respondent
was
doing
what
he
was
doing under his previous contract
albeit
in
a reduced capacity
and
only
focused
on
Crop Science, which was one component
of
his previous contract of
employment.
He
supervised
less
people
because
his work load was
reduced.
During this period the Applicant instructed him to work on the
integrated
Crop
Sciences
strategic
plan for the next five years
.
He was unable to complete this project within
twelve months. His contract of employment was then extended
for
a further period of three months from 1 April 2015 to 30 June 2015 in
order to allow him
sufficient
opportunity
to
deliver
the
integrated
Crop Sciences
strategic
plan. He delivered it on 29 April 2015.
[9]
On
2
April
2015,
the
Third
Respondent
had a meeting with
the Chief Executive Officer (CEO) of the Applicant Dr Moephuli where
the Third Respondent
was
advised
that
a
request
had
been
received
from
the
Director
General
of
the
Department
of
Science
and
Technology for
the
secondment
of
the
Third
Respondent
to
the
National Advisory Council
on
Innovation
("NACI").
The
CEO
indicated to the Third
Respondent
that
he was
prepared
to second
him
and
make up the difference
in
salary.
Dr Moephuli
conceded
during
cross-examination
that
it was
the
CEO's prerogative
to renew
the
fixed- term contracts
for
the
Third
Respondent.
On
15 April 2015, the Third Respondent was advised that
he had received an annual salary increase
for
the
2015/2016 financial year.
[10]
The Third Respondent was required to participate in drafting his
performance contract for the 2015/2016 financial year. The
Applicant
mandated a consultant, M Missio, to negotiate a one year performance
contract with the Third Respondent. This was in
line with other
performance contracts. In this respect the performance contract
implied a further and/or continued employment relationship.
[11]
In
May
2015,
a
review
meeting
was
held
by the Applicant
to
deal
with
the
five
year
plan and on
or
about
2
June
2015, a
recommendation
was
made
by the
Human
Resources
Manager
recording
that
the
Third
Respondent
had
successfully
acted
in
his
position.
The
manager recommended
the
Third
Respondent's
appointment
until
his retirement, which retirement was to take
place within the next five years.
[12]
On 9 June 2015, the Third Respondent was advised that his contract of
employment would not be renewed beyond 30 June 2015.
During the
conversation with the CEO, the Third Respondent was advised that he
had the requisite skills and was one of the good
performers. The
position of Group Executive: Crop Sciences is still available and
there is funding for it as evidenced by the advertisement
of the post
on 19 July 2015.
[13]
The Third Respondent was aggrieved by a failure of the Applicant to
extend his employment contract within the next five years,
which
would take him up to his retirement and he referred an unfair
dismissal dispute for conciliation and later for arbitration
on the
basis that he expected his employment contract to be extended by the
Applicant but it was not extended. When conciliation
failed to
resolve the dispute he referred it to arbitration and the Second
Respondent was appointed to arbitrate the dispute. At
arbitration the
dismissal of the Third Respondent was placed in dispute and he
therefore had to prove its existence.
[14]
In brief the case of the Third Respondent was essentially that, both
the Human Resources Executive and the CEO had promised
him that the
contract which ended in June 2015 would be extended for the next five
years which would see him retire before its
expiry. He expected the
extension of his contract also because he had been with the Applicant
for some time and that, in line with
the CEO, no one was to lose his
job. Further, he expected the extension because he had worked on the
intergraded Crop Science strategic
plan which was designed to cover
the next five years. This plan included the retention of his post
which was not only funded but
was integral to the strategic plan.
[15]
The case of the Applicant was basically to deny making any promises
for the contract extension. The CEO said that it was his
prerogative
to either extend or not extend the contract and he chose the latter.
He said that the existence of a five year strategic
plan was not a
pointer to continued employment of the Third Respondent, pointing out
that as CEO he was also working on a thirty
year plan which could
never entitle him to work thirty years for the Applicant.
The
Commissioner’s findings
[16]
Two essential questions were considered by the Commissioner in his
award. The first was to determine whether the Third Respondent
had
from a subjective point of view an expectation that his fixed term
contract was to be extended or renewed beyond 30 June 2015.
He found
that the Third Respondent had such legitimate expectation. Following
from that finding the second question was whether
this legitimate
expectation was reasonable. Again he found in favour of the Third
Respondent. The Commissioner accepted the version
of the Third
Respondent as one favoured by the probabilities of the case. He
concluded that the Third respondent was dismissed
by the Applicant,
that such dismissal was without a fair reason and that no fair
procedure had been followed by the Applicant.
He then ordered the
Applicant to re-instate the Third Respondent with retrospective
effect until his retirement.
Grounds
for review.
[17]
In its pleading as well as in its heads of argument the Applicant
relied on section 145 of the Act to identify the grounds
of review.
To this extent, the Applicant argued throughout its submissions that
the arbitration award should be reviewed and set
aside on the basis
that the decision reached by the Commissioner was not one that a
reasonable decision maker could reach. During
the presentation of
this matter by the parties, I pointed out to Mr Mokhari appearing for
the Applicant that the test espoused
by the Applicant for review was
not a correct one. This issue had also been raised by the Third
Respondent in his papers and confirmed
by Mr Boda appearing for the
Third Respondent.
[18]
At the commencement of the arbitration proceedings the Commissioner
was first confronted with the question whether the Applicant
had
dismissed the Third Respondent, therefore it was a jurisdictional
issue.
[19]
In
SA
Rugby Players' Association
(SARPA)
v SA Rugby (Pty) Ltd &
Others;
SA
Rugby
(Pty)
Ltd
v
SARPU
&
Another
[2]
("SARPA")
the
Court
held
that-
"
What
section
186(1)
(b)
provides
for
is
that there would
be
a
dismissal
in circumstances
where
an
employee
reasonably
expected
the
employer
to
renew
a
fixed
term
contract
of
employment
on
the
same
or
similar
terms
but
the
employer
only
offered
to
renew
it
on
less
favourable
terms
or
did
not
renew
it.
The
operative
terms
in
section
186(1)
(b)
are,
in
my
view,
that
the
employee
should
have
a
reasonable
expectation,
and
the
employer
fails to renew
a
fixed term contract or renew it on less favourable
terms.
The fixed term contract should also be capable
of
renewal.
[3]
[20]
Further, the Court in
SARPA
held that once
it
is found
that
there
had
been
a
dismissal
as
contemplated
in section
186
(1)
(b)
of
the
Act,
the onus shifts to the employer
to
justify
its
fairness. The
court
in
De
Milander
v
Member
of
the
Executive
Council
for
the
Department
of
Finance
:
Eastern Cape
&
others
[4]
agreed
with
the
view
expressed
in
SARPA
and
also
noted
that
an
employee
who
claims
a
dismissal
must
set
out
the material facts
in
order for a commissioner
to
draw a conclusion
of
law. It follows that the test for review is whether the
Commissioner’s decision is correct or wrong.
[21]
A review application is determined on the basis of the grounds of
review outlined. In the absence of any properly identified
grounds of
review therefore, the review application ought not to succeed. In the
present matter it was never pleaded that the decision
of the Second
Respondent was wrong and that therefore the arbitration award should
be reviewed and set aside. It does not lie in
this Court having to
mero muto
substitute the ground for review for an applicant.
It must follow then that the review application in this matter has no
prospects
of success. In any event, I am of the view that a correct
approach was adopted by the Commissioner in this matter and that he
reached
a correct decision. As a matter of clarity, the
Commissioner’s order must not be construed as ordering a
permanent appointment
of the Third Respondent but it is an extension
of a fixed term contract for a period short of five years as the
Third Respondent
will retire before the expiry of the five years.
[22]
Accordingly, the following order shall issue:
1.
The review application in this matter is dismissed.
2.
The Applicant is ordered to pay the costs thereof.
3.
The arbitration award issued by the Second Respondent in this matter
is made an order of Court.
_________________
Cele J
Judge
of the Labour Court of South Africa.
APPEARANCES:
For
the Applicant:
Mr Mokhari
Instructed
by:
Werksmans Attorneys.
For
the Respondent:
Mr Bhoda
Instructed
by:
Cliffe Dekker Hofmeyer Inc.
[1]
Act Number
66 of 1995, hereafter referred to as the LRA.
[2]
[2008] 9
BLLR (LAC).
[3]
At para 43.
[4]
[2013] 34
ILJ 1427 (LAC).