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[2018] ZALCJHB 93
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National Union of Metalworkers Union of South Africa and Another v Assmang Machadodorp Chrome Works (Pty) Ltd (JS548/16) [2018] ZALCJHB 93 (6 March 2018)
IN
THE LABOUR COURT OF SOUTH AFRICA, JOHANNESBURG
Not
Reportable
Case
no: JS 548/16
In
the matter between:
NATIONAL
UNION OF METALWORKERS UNION
OF
SOUTH AFRICA
First Applicant
MANDLA
PHAKHATHI
Second applicant
And
ASSMANG
MACHADODORP CHROME WORKS
(PTY)
LTD
Respondent
Heard:
15 - 16 February 2018
Delivered:
6 March 2018
JUDGMENT
TLHOTLHALEMAJE,
J.
Introduction:
[1]
With this claim, the first applicant, National Union of Metalworkers
of South Africa (NUMSA), seeks to have the dismissal of
its member,
the second applicant, Mr Mandla Phakhathi be declared substantively
and procedurally unfair. Phakathi’s services
were terminated
together with those of other employees on account of the respondent’s
operational requirements.
[2]
The respondent, Assmang Machadodorp Chrome Works (Pty) Ltd (Assmang),
opposed the claim. At the commencement of trial proceedings,
the
applicants wisely abandoned a claim of procedural unfairness.
Background:
[3]
The background facts to this dispute are to a large extent common
cause and are summarised as follows:
3.1.
Assmang operates a chrome and
manganese open cast mine in Machadodorp, Mpumalanga Province.
Phakhathi commenced his employment with
Assmang in November 2007
as a Raw Material Assistant. In November 2011, he was elected as
a NUMSA Shop-Steward. In January 2012,
he was elevated to the
position of Full-Time Shop-steward. The position of full-time
Shop-Steward is regulated in terms clause
8
[1]
of the Recognition Agreement dated 19 April 2002, concluded
between Assmang,
NUMSA
and other trade unions
.
3.2.
At the time that Phakathi was elected as a Full-Time Shop Steward,
Assmang
had about 700 employees. The first operational requirements
exercise by Assmang took place in 2012, when 404 employees were
retrenched.
The second exercise took place in 2014, when 168
employees were retrenched. In 2015, Assmang’s remaining
furnaces were switched
off, and it was forced to run limited
operations.
3.3.
This resulted in a further
retrenchment exercise in February 2015, leaving it with only 60
employees after a facilitation process
under the auspices of the CCMA
in terms of the provisions of section 189A, read with those of
section 189(3)
[2]
of the Labour Relations Act
[3]
.
3.4.
The parties initially held two consultation meetings facilitated by
the
CCMA. On 6 March 2015, a third meeting was held where
Assmang had indicated that Phakhathi was amongst the employees
identified for retrenchment. In that meeting, NUMSA held the view
that the contemplated dismissal of Phakhathi had to be dealt with
in
terms of the Recognition Agreement internally, and outside the
facilitation proceedings.
3.5.
On 13 April 2015, the parties convened a further meeting to
discuss the contemplated dismissal of Phakhathi. In that meeting
Assmang disclosed its reasoning for selecting Phakhathi as one
of the
employees identified for retrenchment. Its contention was that taking
into account that the total workforce was in all probabilities
going
to be reduced to approximately 60 employees, the position of
Full-Time Shop-Steward was no longer going to be necessary.
The
parties could however not reach an agreement in respect of that
issue.
3.6.
On 20 April 2015, Assmang terminated its employment
relationship
with Phakhathi. On 7 May 2015, the applicants
referred an unfair dismissal dispute to the Metal and Engineering
Industries
Bargaining Council (MEIBC). Conciliation having failed,
the dispute was referred to this Court for adjudication.
The
evidence:
[4]
Assmang led the evidence Mr Dirk Hattingh (Hattingh) its Human
Resource Superintendent in support of its case. His evidence
is
summarised as follows:
4.1.
During the time that Assmang embarked on its restructuring in 2014
and 2015, it had questioned
the logic of having a Full-Time Shop
Steward in the light of the declined number of employees in the
bargaining unit. It was thereafter
agreed with NUMSA in 2014 that
Phakhathi in addition to his Shop-Steward duties, would be expected
to perform those duties on a
part-time basis, and also assume an
additional role as a storeman within Assmang’s stores.
4.2.
Prior to the restructuring exercise in 2015, there was only one
employee employed as a
storeman. Phakhathi was thereafter required to
assist in the stores as part of his dual role. The other storeman had
a longer service
record within Assmang than Phakhathi when LIFO was
applied.
4.3.
At the facilitation meetings, NUMSA had flatly refused to engage
Assmang on the position
of Phakhathi, insisting upon a separate
process to deal with his contemplated dismissal in terms of the
Recognition Agreement.
4.4.
In a letter dated 13 April 2015, Assmang terminated the
full-time Shop-Steward
agreement. The letter
inter alia
recorded the following:
“…
CANCELATION OF FULL TIME SHOP STEWARD
AGREEMENT: ASSMANG MACHADODORP
…
The Company would like to confirm that
we fully agree that NUMSA, in terms of section 8 of the Recognition
Agreement, is not in
contravention of the agreement by this date
having more than 50% membership on site. The Company further agrees
that even under
the proposed structure NUMSA’s membership is
not foreseen to be less than 50% of the workforce.
It is however due to large scale
changes in the ambit of the recognition agreement that the Company
needs to inform you that we
will not be able to perform our
responsibility in terms of section 8 that deals with a Full Time Shop
Steward being paid by the
Company. Our employee number at the signing
of the Recognition Agreement was more than 500 in the bargaining
unit. After this unfortunate
Section 189 process that we are busy
with it seems as if there will not be more than 60 people. We believe
that it will be unreasonable
to expect us to continue performing our
responsibilities accordingly.
You are thus hereby formally being
given notice that the Full Time Shop Steward position will be
terminated in line with the finalization
of the Section 189 process.”
4.5.
Phakhathi was identified for retrenchment due to the application of
the LIFO criterion.
As mentioned above, the other employee in the
stores had more service when compared to Phakhathi.
4.6.
Under cross examination, Hattingh testified that at the commencement
of the restructuring
process, no names were attached to the list of
employees that were identified for retrenchment, and that only the
positions within
different departments were identified. However, all
departments within Assmang were to be affected and more specifically,
a position
within stores was identified for retrenchment. He denied
that the issue of the full-time Shop-Steward was raised only raised
with
NUMSA on the last scheduled consultative meeting. According to
Hattingh the issue was raised prior to 7 April 2015, and
during the retrenchment process, and NUMSA was aware that Assmang
could no longer financially afford to retain the position of
full-time shop-steward.
4.7.
According to Hattingh, NUMSA was of the view that irrespective of the
number of employees
that were to be retained in the bargaining unit,
it was still entitled to have a full-time shop-steward on site.
4.8.
In terms of clause 16.2
[4]
of the Recognition Agreement, if NUMSA had an issue with the
abolition of the full-time shop-steward’s position, it could
have declared a dispute. It is common cause that NUMSA did not
declare a dispute in terms of clause 16.2 of the Recognition
Agreement.
[5]
Phakhathi’s evidence in support of his claim is summarised as
follows:
5.1.
He commenced his employment with Assmang in November 2007 as a
Raw Material Assistant.
Prior to his election as a Full-Time Shop
Steward, he was stationed at the stores as a Procurement Assistant.
During that
time there were five other employees stationed at
the stores. As a consequence of the various restructuring processes
at Assmang,
there was only one employee that was retained at the
stores in 2015.
5.2.
He aligned himself with the
position that his position was to be discussed outside of the
facilitation process. Notwithstanding
NUMSA’s position on the
matter, Assmang had on 13 April 2015 presented them with a
letter terminating his role
[5]
.
5.3.
He testified that the first
time that Assmang raised the issue of the retrenchment the full-time
shop-steward was at the meeting
of 20 March 2015. Further,
Assmang did not comply with clauses 8.1, 17
[6]
and 18
[7]
of the Recognition Agreement.
5.4.
He conceded that during 2014, it was agreed with NUMSA that he would
assist at the stores.
Notwithstanding the agreement, he retained his
position as a full-time shop steward and as such, when the section
189 process commenced,
he should not have been affected.
5.5.
He was of the view that his dismissal was unfair based on the fact
that Assmang failed
to comply with the provisions of the Recognition
Agreement. Further there was no meaningful consultation between NUMSA
and Assmang
in respect of abolishment of the position of full-time
shop-steward.
Evaluation:
[6]
Recently in
Woolworths
(PTY) Ltd v SACCAWU and Others
[8]
the Labour Appeal Court restated the test for substantive fairness in
operational requirements dismissal disputes as follows;
“…
It
is the general consensus of writers on this subject that the test for
the fairness of a retrenchment where s189A applies differs
from that
applicable to retrenchments to which the section does not apply. We
agree with this view. Section 189A(19) which is worded
in peremptory
terms provided that in any dispute referred to the Labour Court in
terms of s191(5)(b)(ii), concerning the dismissal
of this category of
employees, the Labour Court must find that the employee was dismissed
for a fair reason if four grounds are
satisfied namely:
(a)
the dismissal was to give
effect to a requirement based on the employer’s economic,
technological, structural or similar needs;
(b)
the dismissal was
operationally justifiable on rational grounds;
(c)
there was a proper
consideration of alternatives; and
(d)
selection criteria were
fair and objective.
It is trite that the onus of proving
this rests upon the employer”
[7]
The insurmountable difficulties the applicants are faced with in this
case as I understood it, is that they do not dispute any
of the four
factors mentioned above, including the fact that there was commercial
rationale for the removal of the Full-Time Shop
Steward’s
position.
[8]
Their case is mainly grounded in the provisions of clause 8 of the
Recognition of Shop Stewards’ Agreement, which by all
accounts,
cannot be construed as a legitimate basis for attacking the fairness
of a dismissal for operational requirements. A recognition
of shop
stewards agreement cannot by any stretch of imagination be equated
with operational requirements as defined in section
213 of the LRA.
[9]
If I understood the applicants’ case, and notwithstanding
Phakhathi’s vacillation and refusal to answer a direct
question
under cross-examination, their case is essentially that by virtue of
his position as a Full-Time shop Steward, he was
immune from
Assmang’s decision to retrench, because that position was
entrenched by virtue of the provisions of clause 8
of the Agreement.
There is everything wrong and illogical with the applicants’
approach, for the following reasons;
a)
It was not in dispute that at the time that Phakhathi was appointed
as a Full-Tim Shop Steward, there were about 700 employees falling
within the bargaining unit, and there was obviously justification
for
the existence of that position.
b)
When the number of employees dwindled to 60 as at 2015, and
even if
as per the Agreement, NUMSA still enjoyed 50% of the number of
employees in the recognised bargaining unit, there is no
rational
basis advanced by the applicants as to the reason the position of a
Full-Time Shop Steward was necessary. It is not clear
from the
evidence as to how many of the 60 remaining employees were still in
the bargaining unit for the purposes of the 50% representation.
Even
if there was a significant number of NUMSA members, I can still not
find any reason why the position of a Full Time Shop Steward
was
still necessary, especially within the context of Assmang’s
dire financial constraints that were accepted by all parties.
c)
It was further common cause that as a result of the 2014
retrenchments,
Phakhathi was required to assume further roles in the
stores. He conceded that after that exercise, he was no longer a
Full-Time
Shop Steward in the strict sense as he was required to
perform other duties. This could only have been in appreciation that
his
full time role as a shop steward had been diminished to a large
extent.
d)
The fact that an employee is a
full time shop steward does not imply that he/she enjoys immunity
from any operational requirements
and exercise embarked upon by an
employer. A shop steward is an employee in the first instance like
any other
[9]
,
and does not enjoy any other special privileges outside the scope of
the provisions of sections 14
[10]
of the LRA, or section 15, which regulates time off for union
activities.
e)
Significant with the applicants’ case is that to the extent
that they had relied on the provisions of clause 8 of the Agreement,
when that agreement was terminated in April 2015, and prior
to the
termination of Phakhathi’s services, despite the provisions of
clause 16 pertaining to dispute resolution, NUMSA did
not deem it
necessary to approach the CCMA with a section 23 (4) and 24 (2) of
the LRA referral. In fact, the dispute surrounding
Phakhathi’s
position emerged at the facilitation proceedings, and yet nothing was
done.
f)
Even if such a dispute had been referred, and an interpretation
was
made in favour of NUMSA, this would not have prevented Assmang from
proceeding with its retrenchment of Phakhathi, specifically
since an
objective criterion as would have been applied through LIFO, would
have required that he be retrenched. In essence therefore,
the fact
that he was a full time shop steward would not have shielded him from
the application of an objective LIFO criteria.
[10]
To conclude then, the
applicants dismally failed to make out a case of substantive
unfairness in respect of the dismissal of Phakhathi
on account of
Assmang’s operational requirements. Once the dismissal was not
challenged on any of the grounds restated in
Woolworths
[11]
,
there was no basis in law or fact, for the applicants to approach
this court with this claim, and they should have known better.
[11]
This Court is always careful not to make an order of costs in
circumstances where parties continue to enjoy a working relationship.
In this case however, that relationship was abused with the bringing
of this clearly frivolous claim. The claim was a non-starter,
and
even more disconcerting is that despite Phakhathi having been
dismissed together with other members, NUMSA appears to have
given
him special treatment simply because he was a full time shop steward.
In the circumstances, the requirements of law and fairness
dictate
that NUMSA be burdened with the costs of having to defend this
matter.
Order:
[12]
In the premises, the following order is made:
1.
The applicants’ claim is dismissed with costs.
_____________________
E.
Tlhotlhalemaje
Judge
of the Labour Court of South Africa
APPEARANCES:
For
the Applicants:
Mr N. Masutha: of NUMSA (Union Official)
For
the Respondent:
Adv. M.J. van As
Instructed
by:
Cliffe Dekker Hofmeyr Incorporated
[1]
Clause 8:
RECOGNITION OF A
FULL-TIME STOP STEWARD
8.1
Full time shop stewards
Management will recognise a Full Time
Shop steward from the majority union on condition that the number of
members of such union
is above 50% of the number of employees in the
recognised bargaining unit. The full time shop steward will perform
his/her function
in terms of the Full Time Shop stewards’
agreement. Should the number of members of the majority union
decrease below 50%
of the number of employees in the recognised
bargaining unit, this position will be reconsidered.
8.2
…
[2]
Section 189:
Dismissals
based on operational requirements
(1)
When an employer contemplates dismissing one or more
employees
for reasons based on the employer‘s
operational
requirements
, the employer must consult -
(
a)
any person whom the employer is required to consult in terms of
a
collective agreement
;
(
b)
if there is not
collective
agreement
that requires consultation –
(i)
a
workplace forum,
if the
employees
likely to be
affected by the proposed
dismissals
are employed in a
workplace
in respect of which there is a
workplace forum
;
and
(ii)
any registered
trade union
whose members are likely to be
affected by the proposed
dismissals
;
(
c)
if there is no
workplace forum
in the
workplace
in
which the
employees
likely to be affected by the proposed
dismissals
are employed, any registered
trade union
whose
members are likely to be affected by the proposed
dismissals
;
or
(
d)
if there is no such
trade union
, the
employees
likely
to be affected by the proposed
dismissals
or their
representatives nominated for that purpose.
(2)
The employer and the other consulting parties must in the
consultation
envisaged by subsections (1) and (3) engage in a
meaningful joint consensus-seeking process and attempt to reach
consensus on
(
a)
appropriate measures
-
(i) to avoid the
dismissals
;
(ii)
to minimise the number of
dismissals
;
(iii)
to change the timing of the
dismissals
; and
(iv)
to mitigate the adverse effects of the
dismissals;
(
b)
the method for
selecting the
employees
to be dismissed; and
(
c)
the severance pay
for dismissed
employees
.
(3)
The employer must issue a written notice inviting the other
consulting party
to consult with it and disclose in writing all
relevant information, including, but not limited to –
…
[3]
Act 66 of 1995, as amended
[4]
Clause 16:
DISPUTE
RESOLUTION
16.1
No party shall be entitled to recourse to the dispute resolution
provisions in
the [LRA] in respect of any dispute, which is the
subject matter of this dispute resolution clause, until such time as
the provision
of this clause have been exhausted.
16.2
dispute regarding the interpretation or application of this
agreement.
16.2.1 Any
dispute regarding the interpretation or application of this
agreement shall be dealt with in
accordance with the procedure
provided for in this sub-clause.
16.2.2 Any
dispute regarding the interpretation or application of this
agreement may be declared by either
party by way of written notice
to the other party.
16.2.3 …
[5]
Supra
para
4.7
[6]
Clause 17:
COMMENCEMENT AND
TERMINATION OF THIS AGREEMENT
17.1
This agreement shall come into operation on the date of last
signature hereof and
shall remain in force until terminated in
accordance with the provisions of this clause
17.2
This agreement will terminate under the following circumstances:
17.2.1 in
respect of a bargaining unit, should the union cease to have
sufficient representation in that
bargaining unit;
17.2.1 should
either party breach the terms of this agreement, and fail to remedy
the beach within 14
days of being given notice to do so by either
party; or
17.2.3 on one
month’s notice by either party.
[7]
Clause 18:
AMENDMENTS TO
THIS AGREEMENT
18.1 …
18.2 No
amendment of any term or aspect of this agreement shall be effective
unless it is reduced
to writing and signed by the parties.
18.3
Any term of this agreement may be re-negotiated by either party,
provided 30 days’ written
notice is given to the other party
of the intention to re-negotiate.
[8]
[2017] 12 BLLR 1217
(LAC); (2018) 39 ILJ 222 (LAC) at para [35]
[9]
Mondi Paper Co Ltd v PPWAWU & Another (1994) 15 ILJ 778 (LAC)
[10]
“
14.
Trade union representatives
(1) …
(2) …
(3) …
(4)
A
trade union representative
has the right to perform the following functions -
(a)
at the request of an
employee
in the
workplace
,
to assist and represent the
employee
in grievance and disciplinary proceedings:
(b)
to monitor the employer ‘s
compliance with the workplace-related provisions of
this
Act
, any law regulating terms and
conditions of employment and any
collective
agreement
binding on the employer;
(c)
to report any alleged contravention of the
workplace-related provisions of
this
Act
, any law regulating terms and
conditions of employment and any
collective
agreement
binding on the employer to –
(i)
the employer;
(ii)
the representative
trade union
; and
(iii)
any responsible authority or agency; and
(d)
to perform any other function agreed to
between the representative
trade union
and the employer.
(5)
Subject to reasonable conditions, a
trade union
representative
is entitled to take reasonable time off with pay
during
working hours
-
(a) to perform the
functions of a
trade union representative
; and
(b) to be trained in any
subject relevant to the performance of the functions of a
trade
union representative
.
[11]
supra