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[2018] ZALCJHB 120
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National Union of Metalworkers of South Africa and Others v SGB Tedoc Cape (JS599/2015) [2018] ZALCJHB 120 (2 March 2018)
IN
THE LABOUR COURT OF SOUTH AFRICA, JOHANNESBURG
JUDGMENT
Not
reportable - of interest to other
Judges
CASE
NO.:
JS 599/2015
In
the matter between:
NATIONAL
UNION OF METALWORKERS
OF
SOUTH AFRICA
First
Applicant
MASEKO
& 17 OTHERS
Second to further Applicants
and
SGB
TEDOC CAPE
Respondent
Trial:
26-28 February 2018
Judgment:
2 March 2018
JUDGMENT
VAN
NIEKERK J
Introduction
[1]
The respondent is a sub-contractor on Eskom’s Kusile site and
employed the second to further applicants (the employees)
in that
capacity. The employees are all members of the first applicant (the
union). They were dismissed by the respondent for unlawfully
refusing
to work.
[2]
The applicants initially contended that the employees’
dismissal was substantively and procedurally unfair. During argument,
Mr Masutha, who represented the applicants, abandoned that part of
the claim which relates to substantive fairness. The only issue
for
decision then is whether the employees’ dismissal was
procedurally fair.
[3]
The applicants’ case is recorded in paragraph 6 of their
statement of claim. They contend that the respondent failed to
comply
with items 6 (1) and (2) of the Code of Good Practice, that the
respondent failed to engage with the union after it issued
an
ultimatum to return to work, that it chose to institute disciplinary
proceedings against the employees, that the respondent
failed to
engage with or involve union officials who had availed themselves for
discussion, and that ‘other applicants’
were not present
on the day that the strike occurred.
[4]
The applicants seek an order of compensation.
Material
facts
[5]
The relevant factual background, to a large extent, is a matter of
common cause. The employees were housed at what is described
as the
Boslapa residence, where board and lodging was provided by Eskom.
During December 2014, the employees complained about the
actions of
one of Boslapa’s employees, one Stella. Matters came to a head
on 5 February 2015, when a committee representing
the employees
addressed a letter to the manager of the establishment, a Mr Kruger,
requesting that Stella be removed from the premises.
Mr Letsebe, the
respondent’s industrial relations officer, testified that he
attended at Boslapa on the evening of 9 February
2015, where he met
with representatives of the owners, the employees, and the catering
company. Letsebe pointed out to the employees’
representatives
that Stella was not employed by the respondent but he undertook to
address the issue through the appropriate channels.
I accept
Letsebe’s evidence that he had sight of the latter dated 5
February 2015 only on the evening of 9 February 2015.
The letter was
addressed and delivered to Kruger on 5 February 2015, and Mr
Hlatswayo, the author of the letter, could do no more
than offer an
assumption that Letsebe had been furnished with a copy of the letter
earlier than 9 February 2015.
[6]
Be that as it may, despite the undertaking given by Letsebe, on the
morning of 10 February 2015, the employees refused to work,
demanding
that Stella be removed. Hlatswayo, the only one of the employees to
testify, acknowledged that the decision to refuse
to work was
deliberate and premeditated, and that no formal grievance concerning
Stella’s conduct had been lodged in accordance
with the
applicable procedure.
[7]
The respondent became aware of the employees’ refusal to work
early on the morning of 10 February 2015. Letsebe testified
that he
attended at Boslapa on 9 February 2015 at 7h10. The employees refused
to go to work. Letsebe advised them to do so, and
again undertook to
take up their grievance with the respondent’s principal
contractor, since Stella was employed by Eskom.
He explained to the
employees that the respondent had no direct relationship with Stella
and that he would need to resolve the
matter with her employer.
Letsebe testified that he remained at Boslapa for most of the day.
[8]
It is not disputed that at 10h36, the respondent addressed an email
to the union’s shop stewards. The email reads as follows:
Attached
receive a notice about the unprotected strike. Note the urgency of
this matter as we need to resolve this issue today.
Awaiting
your respond (sic).
[9]
The attached notice reads as follows:
UNPROTECTED/ILLEGAL STRIKE ACTION
1.
Employees at the KUSILE POWER STATION site
have embarked on unprotected/illegal strike action that does not
comply with the provisions
of S 64 of the Labour Relations Act, and
the dispute procedures contained in the Project Agreement.
2.
Contractor/employer issued an ultimatum
(copy attached) to employees participating in this unprotected strike
action. It is requested
that as a matter of urgency, management, the
union and employees representative meet to address workers
reasons/concerns that give
rise to the erection.
3.
Management intends to protect its interests
in the “Ultimatum” issued clearly indicates the course of
action contractors/employers
intends to take should the dispute not
be resolved by 10 February 2015 and (sic) 13h00.
4.
Management are available to meet with you
on 10 February 2015 and (sic) 12h30 at its premises TEDOC SGB-CAPE JV
at KUSILE POWER
STATION. …’
[10]
The ultimatum reads as follows:
TO: TEDOC SGB CAPE
EMPLOYEES RESIDING AT BOSLAP
Management of TEDOC / SGB- CAPE would
like to confirm that employees engaged on illegal strike or in breach
of the employment contract
entered into between individual employees
and TEDOC/SGB-CAPE.
Employees engaged in an illegal strike
will lose will forfeit all the accumulated bonuses and the ‘no
work no pay ‘principle
will be fully applied
Resistance to the above notice will
give no options to management on taking decision for disciplinary
action is being taken against
employees embarked on an illegal
strike. You are required to report for duty not later than 13:00
hours today, 10 February 2015.
Your cool off time period has lapsed.
Your cooperation in this regard will
deviate undue disciplinary actions against your bad forms and
aberrant behavior (sic).
[11]
The ‘cooling off’ period referred to in the ultimatum is
a reference to a clause contained in what is known as
the
‘site-specific agreement’ (SSA). The SSA is a collective
agreement that regulates conditions of work at the Kusile
site and
binds all contractor, sub-contractors and their employees... Clause
4.8 of the agreement reads as follows
4.8
Cooling off period:
4.8.1
The Contractor affected will allow the
Trade Unions 4 hours’ time to resolve the issue. Should the
dispute not be resolved
within the above time period the Contractor
shall be entitled to issue an ultimatum and take appropriate action.
4.8.2
All forms of industrial action will be
treated as ‘No Work-No Pay’.
[12]
The preceding clause, 4.7, regulates industrial action. That clause
reads as follows:
4.7 Unprotected
industrial action:
4.7.1 Should any Party promote or
participate in the industrial action not in compliance with the
provisions of this Agreement,
the LRA, Industry Agreements and the
PA, that (sic) Parties shall immediately stop such promotion and
participation and shall take
all necessary steps to persuade its
constituents to cease such action and to comply with the conditions
of employment….
4.7.2 In the event of unprotected
industrial action occurring, the Parties shall take all necessary
steps to bring such action to
an end.
[13]
Letsebe testified that at 12h40, he had sight of the ultimatum issued
by the respondent, which he showed to the employees.
He also
distributed a few copies to employees present. Letsebe testified that
despite the ultimatum, the employees did not return
to work.
[14]
It is not disputed that the meeting scheduled for 12h30 did not take
place. Letsebe could not offer any direct evidence of
the
circumstances, other than to say that he had been informed by Mr
Tinus Ramagopotse, the human resource manager, that the union
did not
arrive. This version of events was disputed by Mr Nkonyane, a
full-time shop steward. He testified that he arrived at the
meeting
venue at approximately 12h15 and that Ramagopotse left the premises,
saying that he was going to a meeting at Eskom. Ms.
Cecilia Mpofu,
who was present representing the respondent, was asked about any
ultimatum that had been issued. Nkonyane testified
that the meeting
was advised that an ultimatum had been issued at 9h00 that morning.
In the absence of the human resources manager,
the meeting was
rescheduled for later that afternoon, and later, for the following
day, 11 February 2015. That meeting did not
take place. Nkonyane’s
evidence regarding this exchange was not challenged under
cross-examination, and I accept his version
of events.
[15]
On 11 February 2015, it is not disputed that the employees were
excluded from the workplace by Eskom and that they were later
suspended pending a disciplinary hearing.
[16]
A disciplinary hearing was scheduled for 13 February 2015, on charges
of an illegal work stoppage alternatively, an unlawful
refusal to
work.
[17]
On 13 February 2015, the disciplinary hearing involving 117 employees
was convened in the boardroom of the Bronkhorstspruit
library. The
hearing was chaired by a labour consultant, Mr Leslie Ntuli. There is
a dispute about what transpired at the hearing.
Letsebe testified
that the unions requested that the matters be dealt with on an
individual basis, since some of the employees
had individually-based
reasons for not attending at work on 10 February 2015. The unions
also wished the matter to be dealt with
in terms of what was referred
to as the “CDR process”, a procedure equivalent to that
contemplated by s188 of the LRA,
and which would have bypassed
internal disciplinary processes in favour of an immediate referral to
arbitration. Nkonyane’s
evidence was that such an agreement
was, in principle, reached between the unions and the respondent, and
for that reason, the
unions left the hearing. Hlatswayo’s
testimony, consistent with the applicants’ statement of case,
was that a postponement
was sought on the basis of employees’
personal circumstances, and the fact that some of the employees who
had been excluded
from work were not present. Neither of these
versions was put to Letsebe in cross-examination, and Letsebe’s
evidence regarding
the disciplinary hearings was not challenged.
[18]
In the absence of any indication afforded to Letsebe that his
evidence would be the subject of challenge, and given the internal
inconsistency in the evidence proffered by the union, I accordingly
accept that the unions sought to postpone the disciplinary
hearing on
the basis that individual hearings be held, and that when this was
refused, the unions left the enquiry, refusing to
further participate
in it. I should mention that Letsebe’s version is consistent
with a document referred to by him, which
appears to be summary of
the proceedings of the disciplinary hearing, prepared by Ntuli. Ntuli
records that after NUMSA and UASA
had requested a list of their
members, NUMSA requested that its members would like to be
represented individually, and UASA requested
that the matter be
referred to CDR. Ntuli records that these requests were opposed by
the respondent. He also records his ruling
that the matter proceed as
scheduled, and that both UASA and NUMSA thereafter ‘opted not
to participate’.
[19]
Letsebe further testified that the respondent convened appeal
hearings, and that 3 of the employees appealed against their
dismissals. It is not disputed that the union elected not to
participate in the appeal hearings, and that by the time that they
were convened, the union had already referred a dispute to the
bargaining council.
Applicable
legal principles
[20]
The legal principles to be applied to a dispute concerning a
dismissal for participation in an unprotected strike are well
established. Item 6 (1) of the Code of Good Practice contained in
Schedule 8 to the Labour Relations Act reads as follows:
6 (1) Dismissal and industrial action.
(1) Participation in a strike that does not comply with the
provisions of Chapter IV is misconduct.
However, like any other act
of misconduct, it does not always deserve dismissal.
The substantive fairness of dismissal
in the circumstances must be determined in the light of the facts of
the case, including –
(a)
the seriousness of the contravention of
this Act;
(b)
attempts are made to comply with this Act;
and
(c)
whether or not the strike was in response
to unjustified conduct by the employer.
(2)
Prior to dismissal the employer should, at the earliest opportunity,
contact a trade
union official to discuss the course of action it
intend to adopt. The employer should issue an ultimatum in clear and
unambiguous
terms that should state what is required of the employees
and what sanction will be imposed if they do not comply with the
ultimatum.
The employee should be allowed sufficient time to reflect
on the ultimatum and respond to it, either by complying with it all
rejecting
it. If the employer cannot reasonably be expected to extend
the steps to the employees in question, the employer may dispense
with
them.’
[21]
The requirement in Item 6 of the Code that an employer should, at the
earliest opportunity, contact a trade union official
to discuss the
course of action it intends to adopt, affords the union an
opportunity to persuade the strikers to resume work and
secondly,
provides a safeguard against possible rash action by the employer.
When an employer issues an ultimatum, it should meet
the requirements
of the Code, and in particular, must ensure that it allows employees
sufficient time to reflect on the ultimatum
and to respond to it.
This court has long held that the requirements of procedural fairness
incorporated in Item 6 do not constitute
a series of steps with which
the employer must comply for the sake only of compliance. The purpose
of contacting a trade union
regarding an unprotected strike is not a
formal requirement of notice – it is to afford the union an
opportunity to intervene
and bring its influence to bear on the
situation before any dismissal is effected, and to afford the union
the opportunity to make
representations to the employer.
[22]
Further, the courts have for some years made clear that the
audi
alteram partem
principle applies in the case of a dismissal for
participation in an unprotected strike, irrespective of whether there
has been
a failure to comply with an ultimatum. In
Modise v &
others v Steve’s Spar Blackheath
(2000) 21
ILJ
519
(LAC), the LAC held that an ultimatum and a hearing serve two
separate and distinct purposes. A hearing serves the purpose
ultimately of affording employees or a union acting on their behalf
the opportunity of stating why they should not be dismissed,
notwithstanding their failure to comply with an ultimatum. In short,
the requirements of procedural fairness relevant to dismissal
for
participation in an unprotected strike are not discharged only by the
issuing of an ultimatum. When an ultimatum has gone unheeded,
an
employer must initiate further steps to afford the right to be heard
in a manner that is appropriate to the circumstances.
Analysis
[23]
As I have indicated, the only issue in dispute is whether the
employees’ dismissal was procedurally fair. The two primary
submissions by the applicants are that the employees were not
afforded an opportunity to state their case prior to their dismissal,
and that their dismissals were procedurally unfair because the
respondent acted in breach of its obligations in terms of clause
4.8.1 of the SSA.
[24]
There is manifestly no merit in the first submission. The respondent
convened a disciplinary hearing, before an independent
chair, to
consider the charges brought against the employees. The request for
individual hearings was clearly a ploy to delay the
disciplinary
process – a total of 117 employees had been charged with the
same offence, all alleged to have been committed
in the same factual
circumstances. To the extent that a minimal number of employees
wished to raise individual exculpatory circumstances,
they could have
done so in a collective hearing. There was nothing unreasonable in
the chair’s decision to refuse to conduct
individual hearings.
[25]
To the extent that the applicants’ submission relies on a
version to the effect that there was an agreement (at least
an
agreement in principle) to effect that the issue would be referred to
arbitration and the disciplinary hearing bypassed, this
version, for
the reasons outlined above, is not credible. The union elected to
leave the enquiry for reasons that are not defensible,
and having
done so, it cannot now be heard to say that its members were denied
an opportunity to state their case.
[26]
In regard to the second of the applicants’ submissions, and
despite Letsebe’s assertion that the ‘cool off
period’
had expired before the ultimatum was issued, this cannot be so. The
wording of clause 4.8.1 of the SSA is clear.
The purpose of the cool
off period is to afford a trade union the opportunity to intervene
and resolve the issue in dispute, before
an ultimatum is issued. The
interpretation contended for by the respondent (i.e. that the
four-hour period commences from the time
of commencement of the
industrial action in question) is not sustainable, having regard to
the plain meaning of the clause and
its purpose.
[27]
The respondent accepts that the time at which the union was advised
of the unprotected strike was at 10h36, when the email
was sent to
the shop stewards. The four hour period expired at 14h36 that
afternoon. The ultimatum was issued, it would appear,
simultaneously
with the email, if not before. On the respondent’s own version
therefore, the ultimatum was premature.
[28]
Further, the evidence supports the conclusion that after the
ultimatum was issued, the respondent
made no attempt to meet with the
shop stewards to resolve the issue giving rise to the strike. The
respondent called for a meeting
at 12h30, and for reasons that are
not apparent, failed to attend the meeting. Again, Ramagopotse was
not available to give evidence,
and his intentions remain unknown.
But objectively, the deferment of the meeting until 16h00 the same
afternoon and then to the
next day is a clear indication that the
respondent did not place any premium on an engagement with the shop
stewards, and indeed,
its conduct is indicative of an intention to
avoid a meeting.
[29]
In summary – the respondent acted in breach of the SSA by
issuing an ultimatum prior to the expiry of four hours. The
ultimatum
was premature. Further, the respondent failed to meet with the union
shop stewards as it initially agreed to do, and
effected the
dismissals of the employees without any meaningful attempt to engage
with them. For these reasons, I find that the
employees’
dismissal was procedurally unfair.
Remedy
[30]
If a dismissal is found to be only procedurally unfair, the court may
not order reinstatement. Any amount of compensation to
be awarded for
a dismissal that is procedurally unfair is the subject of a
discretion to be exercised by the court. The LRA requires
that any
award of compensation be reasonable.
[31]
The most recent precedent concerning compensation for a procedurally
unfair dismissal in the context of an unprotected strike
is
National
Union of Metalworkers of SA v CBI Electric African Cables
[2013]
ZALAC 25.
In that case, the LAC increased the sum awarded by the
court
a quo
to an amount equivalent to 12 months’
remuneration. I am not persuaded that a similar amount, or anywhere
near it, is appropriate
in the present circumstances. First, the
issue over which the strike was called (unlike the situation in
CBI
)
was one over which the respondent had no control. Secondly, the union
chose not to participate in the disciplinary hearing and
the
subsequent appeal process for reasons that are less than persuasive.
It must bear responsibility for that election, and for
the prospect
that matters may have turned out differently had it presented a case
at that early stage. However, I must also necessarily
take into
account what amounts to a serious breach by the respondent of the
requirements of fair procedure. Had the respondent
permitted the
union to intervene prior to issuing an ultimatum and had it met with
union officials when it convened a meeting ostensibly
for that
purpose and genuinely sought a resolution to the dispute, the dispute
may well have been resolved. Instead, the respondent
chose the route
of disciplinary action over any prior attempt at dispute resolution.
[32]
Mr Whittington, who appeared for the respondent, urged me to take
into account the fact that union took no steps on the morning
of 10
February 2015 to secure a return to work. There is merit in this
submission. The SSA makes clear that the union was obliged
to
intervene and take all necessary steps to secure a return to work.
There is no evidence that the union took any steps to secure
a return
to work or even attempt to persuade its members to return to work.
The provisions of the SSA acknowledge the disruptive
effect of
unprotected industrial action on work at the Kusile site. Letsebe
gave evidence that the refusal of the respondent’s
workers to
perform their jobs impacted on the work of other sub-contractors and
the project as a whole. That is no doubt why the
SSA places a high
premium on compliance with dispute resolution procedures and swift
intervention by trade unions to ensure compliance
with the agreement.
In addition to the union’s failure to act, the employees’
conduct, in deciding to strike in support
of an issue over which
their employer had no direct control and which they had been assured
would receive attention, without following
any of the prescribed
procedures, must also count against them.
[33]
In my view, having regard to all of the relevant factors,
compensation in a sum equivalent to six months’ remuneration
for each of the employees is just and equitable.
Costs
[34]
Costs are an issue that in terms of s 162 of the LRA is the subject
of a discretion to be exercised by the court, having regard
to the
requirements of the law and fairness. In so far as the result is
concerned, the applicants have been only partially successful
in
their claim. I was advised that a collective bargaining relationship
between the parties remains in existence. Given that the
applicants
have been only partially successful and that an order for costs has
the potential at least to prejudice the relationship
between the
parties, in my view, the interests of fairness are best served by
making no order as to costs.
For
these reasons, I make the following order:
`1. The
dismissal of the second to further applicants was substantively fair,
but procedurally unfair.
2.
Each of the second to further respondents is awarded compensation in
a sum equivalent
to 6 (six) months’ salary, to be calculated at
their rate of remuneration on the date of dismissal.
André
van Niekerk
Judge
REPRESENTATION
For
the applicants: Union official
For
the respondent: Adv. D Whittington, instructed by Fluxmans Inc.