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[2018] ZALCJHB 133
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Independent Municipal and Allied Trade Union obo Bonn and Others v Nama Khoi Municipality and Others (JR722/15) [2018] ZALCJHB 133; [2018] 9 BLLR 916 (LC) (27 March 2018)
Of
interest to other judges
THE LABOUR COURT OF
SOUTH AFRICA,
HELD AT JOHANNESBURG
C
ase no: JR
722/15
In the
matter between:
THE INDEPENDENT MUNICIPAL AND
ALLIED TRADE UNION obo R M
BONN & 46 OTHERS
Applicants
and
NAMA KHOI MUNICIPALITY
First
Respondent
MAPUTLE MOHLALA
(NO)
Second
Respondent
SOUTH AFRICAN LOCAL
GOVERNMENT BARGAINING
COUNCIL
Third
Respondent
Heard
:
22 March 2018
Delivered
:
27 March 2018
Summary:
(Review – jurisdictional point – reason for dismissal –
applicant’s referring dispute
to arbitration on basis that
reason for dismissal unknown – letter of termination not
specifically identifying reason as
one of the legitimate grounds of
dismissal – employer only raising jurisdictional question at
arbitration – arbitrator
deciding reason for dismissal based on
submissions made by parties with their agreement – arbitrator
finding reason for dismissal
operational in nature)
JUDGMENT
LAGRANGE
J
Background
[1]
At the end of August 2014, the individual
applicants (‘the employees’), who were employed by Nama
Khoi Municipality
(‘the municipality’) were issued with
termination notices in Afrikaans simply headed “Diensbeȅindiging”
(Termination of service). The letter concluded that the
non-advertisement of the posts which the employees occupied, or
alternatively,
their placement in permanent positions was without
justification (‘ongegrond’) for the following reasons:
1.1
Clause 3.8 of the Migration and Placement
Policy of the municipality provided that no staff member appointed on
the permanent establishment
could be placed in a post to which a
fixed term contract applied and no staff member employed for a fixed
period could be placed
permanently in a post in the permanent
establishment.
1.2
The approved Personnel Provisioning Policy
states that:
1.2.1
posts could only be filmed in terms of the
post structure approved by the Council and the executive committee
for which budgetary
provision is made;
1.2.2
all vacant posts must be first advertised
internally and, if not filled, externally.
1.3
The last organogram approved by the
municipality was approved at a council meeting on 15 November 2011.
All organograms drawn up
after that were merely drafts which were
never approved.
[2]
The letter gave the employees one month’s
notice of their termination.
[3]
The applicants referred an unfair dismissal
dispute to the SALGBC claiming that their dismissals were for an
unknown reason. At
the arbitration hearing the municipality raised a
jurisdictional point claiming that the dismissals were not for an
unknown reason
but for operational reasons. Accordingly, the
municipality argued the dismissal dispute should be adjudicated by
the Labour Court
under s 191(5)(b)(ii) of the Labour Relations Act,
66 of 1995 (‘ the LRA’).
The
ruling
[4]
Instead of hearing evidence, the arbitrator
decided the jurisdictional question on the basis of submissions made
by parties’
representatives. The parties acquiesced in this
process. In the course of the municipality’s submissions, it
was argued by
the municipality that the employees exceeded the
numbers on the fixed establishment of the municipality as determined
by the approved
organogram and this placed a financial strain on it.
The union representative emphasised that, it maintained that the real
reason
for the dismissals which the municipality relied on was that
the appointment of the employees was invalid and that was a reason
which could be arbitrated on.
The
applicants objected to the characterisation of their termination as
dismissal for operational reasons because they maintain
that the
reason for the termination did not conform to the definition of
operational requirements in section 213 of the LRA, which
defines
them as requirements based on ‘the economic,
technological, structural or similar needs of an employer’.
[5]
Essentially, the arbitrator found that,
because the applicants had been employed in excess of the permanent
staff establishment
in terms of the approved 2011 organogram on which
the approved staff budget was based, it was necessary for the
municipality to
align the staff complement with the approved staffing
levels and budget and accordingly the need to terminate the services
of staff
like the applicants who had been employed unlawfully in
excess of the lawful permanent establishment was operational in
nature.
Evaluation
[6]
The applicants contend the ruling should be
set aside because it was incorrect and the arbitrator committed a
reviewable irregularity
in the conduct of the proceedings on the
jurisdictional point.
[7]
In
National Union of Metalworkers of South Africa obo Sinuko v Powertech
Transformers (DPM) and others
[1]
the LAC
reiterated the test to be applied in such cases as originally
formulated in
Wardlaw
v Supreme Moulding (Pty) Ltd
[2]
,
and stated:
“
[20]
What is clear from
Wardlaw
is that a two stage process in the adjudication before the Labour
Court was not necessarily being advocated. The Labour Court assumes
jurisdiction on the basis of what the employee alleges the reason for
the dismissal to be - but if it later becomes "apparent"
to
the court that the reason for the dismissal is a different one and
one in respect of which it does not have jurisdiction, the
Labour
Court should not adjudicate the merits of the dispute, but allow the
matter to be referred to the right forum with jurisdiction
in order
for that forum to determine the merits of the dispute. In Wardlaw,
this Court did not exclude the possibility that the
true nature of
the dispute may only become apparent once all the evidence has been
led and the court has considered it. Generally,
this is the time when
the court will become aware of the true nature of the dispute.
However, in Wardlaw, this Court also did not
exclude the possibility
that the true nature of the dispute may also become apparent earlier,
i.e.before all the evidence is led.
An example that readily comes to
mind is if the issue of jurisdiction and the true nature of the
dispute is separated from the
merits of the dispute and raised at the
outset of the proceedings, requiring the court to determine those
issues on the evidential
material available, or presented during that
phase of the proceedings.
[21]
There is no valid reason why the procedure that applies in the Labour
Court does not also apply in arbitrations conducted in
terms of or
under the Act.”
[8]
On
jurisdictional matters, the court needs to consider if the ruling was
objectively correct
[3]
not whether the arbitrator was unreasonable in arriving at it.
[9]
The municipality chose to identify the
reason for the dismissals as being for operational requirements,
thereby provisionally bringing
it within the scope of one of the
three legitimate reasons for a fair dismissal recognized in s 188(1)
of the LRA. In whichever
forum the matter proceeds, the municipality
will have the onus of proving the fairness of that reason and the
fairness of the procedure
followed. The applicants appear to have
adopted the view that the validity of that rationale for the
dismissals is one that the
arbitrator was required to determine when
he was required to make the jurisdictional ruling on the point
in
limine
.
[10]
Although
the applicants referred the matter to arbitration under
s191(5)(a)(iii) of the LRA on the basis that they did ‘not
know
the reason for dismissal’, when the municipality raised the
jurisdictional issue it provided a reason for the dismissal.
Whether
that reason was genuine or not, the reason for the dismissal could
not still be said to be ‘unknown’ at that
stage, and on
the basis of the reason provided the dismissal was not one which the
arbitrator had jurisdiction to determine: it
was not justified on the
basis of incapacity or misconduct, nor did it involve the
retrenchment of a single employee
[4]
,
over which he would have had jurisdiction.
[11]
Moreover,
if in fact the municipality had dismissed the employees because it
considered their employment unlawful and invalid, as
the applicants
later appeared to argue at the hearing on the jurisdictional point,
the arbitrator would have had no power to determine
the fairness of
such a dismissal, except indirectly by deciding that the real reason
for the dismissal was not the one provided
by the municipality. But,
to even consider if there was a genuine operational reason for
the dismissals the arbitrator would
have to enter the terrain of
deciding if the dismissals could be substantively fair on operational
grounds, a matter lying outside
his jurisdiction except where the
retrenchment of only one employee is under consideration. It should
also be mentioned that the
applicants were not asking the arbitrator
to decide that their dismissals could not be fair for any reason
because they were invalid
as occurred in
Matatiele
Local Municipality v Shaik and others
.
[5]
[12]
Consequently, I am satisfied that,
objectively speaking, the employer’s reason for the dismissal
was retrenchment, whether
or not that is a sound justification for
the dismissals. The soundness of that justification will be tested in
trial proceedings
and it was sufficient for the arbitrator to be
satisfied that the reason relied upon is the one that would have to
be adjudicated
upon.
[13]
The
applicants also argued that the arbitration proceedings should be set
aside on the basis that the arbitrator committed a reviewable
irregularity in the conduct of the proceedings. The applicants claim
that the arbitrator should not have relied on submissions
by the
parties but should have heard evidence before reaching a conclusion
on the reason for the dismissals. No objection to the
process was
made by the applicants who were represented at the arbitration and
nothing prevented them from objecting to the process
at the time.
This case is distinguishable in my view from where the
arbitrator decided the substantive merits of the case
on the basis of
submissions such as occurred in
Arends
and others v South African Local Government Bargaining Council and
others
[6]
where a jurisdictional point was raised for the first time in written
arguments submitted after the hearing and the arbitrator
decided the
matter on the basis of the jurisdictional point without affording the
other party a reasonable opportunity to deal
with it.
[7]
In this instance, the arbitrator was dealing with a situation where
one party said it did not know the reason for dismissal and
the other
provided its ostensibly legitimate reason, albeit that it may
struggle to justify it as a substantively and, or alternatively
procedurally, fair one. The applicants had a fair opportunity to make
representations on the issue and the thrust of their submissions
go
to questions that are best addressed when the fairness of the
dismissal are considered.
[14]
On the reasoning above, I am satisfied the
arbitrator did not commit a reviewable irregularity in the conduct of
the proceedings
and that objectively speaking the jurisdictional
question was correctly decided.
Costs
[15]
There may have been some merit in a cost
award being made against the municipality at the arbitration
proceeding for not raising
the jurisdictional point earlier, but I do
not think that should affect the issue of costs in these proceedings,
where the principles
of fairness and law lead me to conclude that the
parties must bear their own costs.
Order
[1]
The review application is dismissed.
[2]
No order is made as to costs.
_______________________
Lagrange
J
Judge
of the Labour Court of South Africa
APPEARANCES
APPLICANTS:
S
Grobler instructed by Kramer
Weihmann
& Jouber Attorneys
RESPONDENT:
N
Cloete of Neville Cloete
Attorneys
Inc.
[1]
[2014] 2 BLLR 133
(LAC) at 139-140,
[2]
[2007] 6 BLLR 487 (LAC).
[3]
Qibe
v
Joy
Global
Africa
(Pty)
Ltd;
In
re:
Joy
Global
Africa
(Pty)
Ltd
v
CCMA
and
others
[2015]
4
BLLR
415
(LAC)
at 417-8, para [5].
[4]
Under s 191(12) of the LRA.
[5]
[2017] 11 BLLR 1090 (LAC)
[6]
[2015] 1 BLLR 23 (LAC)
[7]
At 30, para [19]