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[2018] ZALCJHB 238
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Association of Mineworkers and Construction Union v Anglo American Platinum Ltd and Others (J1833/18) [2018] ZALCJHB 238; [2018] 11 BLLR 1110 (LC); (2018) 39 ILJ 2280 (LC) (2 July 2018)
THE
LABOUR COURT OF SOUTH AFRICA, JOHANNESBURG
JUDGMENT
Reportable
CASE NO: J 1833/18
In the matter between:
ASSOCIATION OF MINEWORKERS
AND CONSTRUCTION
UNION
Applicant
and
ANGLO AMERICAN PLATINUM
LTD
First
Respondent
RUSTENBURG PLATINUM MINES
LTD
Second
Respondent
REGISTRAR OF PENSION
FUNDS
Third
Respondent
Application heard: 27 June 2018
Judgment delivered: 2 July 2018
JUDGMENT
VAN
NIEKERK J
Introduction
[1] The applicant (the union) seeks an
urgent interdict to prevent the transfer of those of the first
respondent’s employees
who are members of the union from the
Amplats Group Provident Fund (AGPF) to the Old Mutual Super Fund (Old
Mutual).
[2] This matter was initially enrolled
for hearing on 30 May 2018. On that date, the parties agreed to an
order in terms of which
the application was postponed to 27 June
2018, and any transfer from the AGPF to Old Mutual suspended. They
also agreed on the
exchange of further affidavits. In the interim,
the parties have further agreed, to the extent that the dispute
pertains to the
interpretation and application of a collective
agreement (this being the 2016-2019 wage agreement, to which I shall
refer in due
course), to waive the internal dispute resolution
process, and refer a dispute in terms of s 24 of the Labour Relations
Act (LRA)
to the CCMA. They further agree that the court should
entertain the matter in terms of s 158(2) (b) of the LRA, on the
basis that
for the purposes of that provision, it would be expedient
to do so.
[3] In so far as these proceedings
concern inter-related disputes regarding the application and
interpretation of a collective agreement
and an alleged unilateral
change to the terms of the contracts of employment of the union‘s
members, the court accepts that
it is expedient to determine the
dispute on the basis agreed between the parties. The same facts give
rise to what has emerged
as two different causes of action, and to
the extent that the court is empowered to assume jurisdiction to
determine both disputes
in a single proceeding, this is both in the
interests of the parties and accords with the statutory purpose of
efficient and expeditious
dispute resolution.
The issues
[4] The union’s founding and
supplementary founding affidavits disclose two grievances. The first
is that the respondents
acted duplicitously by engaging with the
union regarding the possible appointment of a retirement fund in
which the union has a
substantial interest (IGULA), while at the same
time engaging with other suitors. The second is one that suggests
that the contributions
made by union members to their retirement
funding are made from their own pockets, and that they should
therefore have the right
to determine how that investment should be
managed and by whom. This being a legal proceeding in which the union
is required to
establish (amongst other requirements) the existence
of a clear right, the union must necessarily articulate the legal
rights on
which it relies to secure the relief that it seeks.
[5] The translation of a grievance
into a legal cause of action is often problematic. Counsel were
agreed that there are only two
primary issues that need be decided.
The first is whether the respondents have breached the terms of the
wage agreement. Ancillary
to this is the union’s contention
that in the run-up to the decision to appoint Old Mutual and in the
light of the union’s
demand relating to retirement funding made
during the negotiations that preceded the wage agreement, the
respondents acted in bad
faith. The second issue is the union’s
contention that by appointing Old Mutual, the second respondent
(Rusplats) breached
its members’ contracts of employment.
Although it is not apparent from the papers, I will accept that in
respect of this
latter claim the court has jurisdiction by virtue of
s 77(3) of the Basic Conditions of Employment Act (BCEA). Finally,
although
the dispute concerning access to documentation is not a
primary dispute, it is the subject of a discrete interlocutory
application,
and I deal with it below on that basis.
Factual background
[6] The material facts are a matter of
common cause. Rusplats is a subsidiary of the first respondent,
Amplats. Rusplats employs
some 20 000 people, of whom 18 174 are
union members.
[7] The union’s members are
engaged on one of four standard-form contracts. The first was used
from November 2017. Clause
6.2.3 of that contract reads:
6.2.3
You shall, as a condition of employment, join and conform with the
rules of any pension provident fund nominated by the Company
for the
benefit of employees in the service of the Company, from time to
time. In the event that the Company nominates a different
pension
provident fund, you shall be notified and you will be required to
transfer to the new fund. The Company and Employee contributions
toward the fund will be the amounts, stipulated in Annexure B to this
Agreement. The Company shall pay the contributions to the
fund on
your behalf, monthly in arrears.
[8] The second iteration, used in
standard-form contracts from October 2000 and 16 October 2017, reads
as follows:
6.
You shall become a member of the Company’s retirement/provident
fund (defined contribution) or any other fund established
by the
Company from time to time. The Company contribution will be an amount
equivalent to 15% (inclusive of the cost of administration
and risk
benefits, i.e. death, disability and funeral) of your monthly
pensionable salary funded from within your monthly pensionable
salary, unless you currently enjoy a higher company contribution for
historical reasons which will remain unchanged. Your contribution
will be an amount equivalent to seven and a half percent (7.5 %) of
your monthly pensionable salary to the fund. The Company shall
pay
both these contributions to the fund on your behalf monthly in
arrears, the cost of which forms part of your monthly pensionable
salary.
[9] The third contract was used
historically before October 2016, and in paragraph 3 records the
following:
Deductions
The
Employee authorises the Company to make the following deductions from
his/her wages:
Such
deductions as the Company may be obliged to make in terms of the
provisions of any law, including but not limited to any income
tax
deductions or unemployment insurance fund (U.I.F) contributions it
may be obliged to deduct;
Any
deduction which the Employee expressly authorises the Company in
writing to make;
Any
deductions which the Company is entitled to make as a condition of
employment if he/she wishes to participate in the following:
Death
Benefit contributions;
Amplats
or any other Pension/Provident Fund contributions;
Fatal
Accident and Illness Insurance Scheme contributions;
Medical
Aid/Benefit Society contributions.
Clause 8 of the contract reads:
The
Employee shall join and conform with the rules of any pension or
provident fund or insurance arrangement or medical aid or benefit
society nominated by the Company and established for the benefit of
the employees in the service of the company, when required
to do so
as a condition of his/her employment.
[10]
The fourth contract was also used historically and before October
2016 and in clause 6 contains a clause similar to that in
clause 6 of
the second contract of employment referred to above.
[11] Rusplats’s policy
regulating retirement funding is recorded in the employment manual, a
central repository of all the
terms and conditions of employment
applicable at Rusplats operations. Section 1 of the employment manual
contains an introduction,
which reads as follows:
This
manual serves as a guideline to the human resources and global shared
services practitioners as regards the formulation, configuration
and
communication of employees’ conditions of employment and
benefits. It is maintained on an electronic database by the
Remuneration and Benefits department of Anglo-American Platinum and
covers all D1 and below employees across all Operations, managed
joint ventures and subsidiaries. Some of the benefits outlined herein
may apply to other employee categories (i.e. Band 6 and above,
Flexpack) for which the specific benefit manuals. It is owned by the
Remuneration and Benefits department who has a responsibility
for
ensuring that it stays current and accessible.
[12] Chapter 5 of the employment
manual deals with retirement funds and incorporates the following
provision:
As
a condition of employment, all enrolled (permanent) Anglo Platinum
employees must become a member of a Retirement/Pension/Provident
Fund
as determined by the Company
[13] Finally, insofar as the rules of
the AGPF are concerned, the fund of which the union’s members
are currently members,
rule 9.2 sets out the process that must be
followed when a participating employer has decided to participate in
another approved
fund. The rule reads as follows:
9.2
If an Employer ceases to participate in the fund as a result of the
decision to participate in/or to establish another approved
fund or
an approved pension fund, then the fund credit of each member in the
service of that employer who is eligible for membership
of such fund
on a date determined by the trustees shall be transferred to such
approved provident fund or approved pension fund.
The employee shall
cease to participate in the fund on finalisation of the transfer. On
transfer of his fund created in terms of
this rule the fund shall
have no further liability in respect of the member.
[14] In so far as the collective
dimension of this dispute is concerned, the following facts are
common cause. The current levels
of representativity are the union
50.28%; NUM 25.85%; UASA 10.70%; and NUMSA 1.19%. Wage negotiations
are conducted in what is
referred to as a central bargaining forum.
In the latter part of 2016, wage negotiations took place in which the
union, UASA and
NUM participated. In the course of the first meeting
of the forum, held on 2 August 2016, the union indicated that its
members
had mandated it to have their provident fund benefits
transferred to IGULA. The demand had been foreshadowed by a letter
addressed
by the union to Amplats on 6 July 2016. Rusplats on the
other hand adopted the position that employees be required to be
members
of a fund of its choice, and recorded that it was not willing
to be divested of its prerogative to determine its employees’
fund membership.
[15] The wage negotiation continued in
the forum until 18 October 2016, when an agreement was reached. The
agreement (referred to
as the ‘wage agreement’) regulates
wages and other conditions of employment for the period 1 July 2016
to 30 June 2019,
and applies to all members of the union employed by
Rusplats and to other employees in the bargaining unit by virtue of
an extension
of the agreement in terms of s 23(1) of the LRA. The
terms of that agreement are key, since as I have indicated, one of
the two
strands of the union’s case is that Rusplats has
breached its terms.
[16] Clause 31 of the wage agreement
contains what is commonly known and what is referred to as a peace
obligation. The clause reads
as follows:
31.
The parties agree that no party, and in the case of AMCU , none of
its members, shall be entitled to embark upon any industrial
action
whatsoever in respect of wages, issues referred to process or task
teams, and/or any other conditions of employment benefits
in addition
to those that have been agreed upon by the parties. It is further
agreed that any such industrial action will amount
to a contravention
of section 65 (1) (a) and (b) of the LRA.
32.
This agreement is entered into in full and final settlement of all
demands and proposals and counterproposals made by the parties
during
the negotiation processes that led to this agreement being entered
into.
33.
Neither AMCU nor its members shall call, encourage, instigate or
participate in any strike or other industrial action in respect
of
any matter or issue-
33.1
regulated or provided for in this agreement;
33.2
that formed the subject of proposals or counterproposals made during
the course of the negotiations that led to this agreement
being
entered into; or
33.3
that has been referred to a task team or a working group, or has been
the subject of consultation in terms of this agreement.
34.
Neither AMCU nor its members shall seek to enter into further
negotiations, or make further demands or proposals, relating to
terms
and conditions of employment that would apply during the period of
application of this agreement, and shall not call, instigate
encourage or participate in any strike or other industrial action on
such an issue. This shall also apply to any other demands
or
proposals that would increase employment costs during the period of
application of this agreement.
35.
AMCU shall take all reasonable steps necessary to ensure compliance
with the provisions of this clause.
36.
The parties undertake at all times to perform all things necessary to
implement and maintain the terms, conditions and operations
of this
agreement
[17]
Clause 29 of the wage agreement reflects the agreement ultimately
reached in respect of the demand for the transfer to IGULA.
It reads
as follows:
29.
The parties hereto agree that the following issues would be referred
to joint task teams for discussion. The task teams will
attempt to
finalise the work by 30 April 2017. However, the task team’s
terms of reference will be finalised within three
days of signature
of this agreement:
29.1
Productivity;
29.2
ESOP Scheme;
29.3
Separation/retrenchment package; and
29.4
IGULA pension/provident fund.
[18] The first meeting of the task
team established to consider the IGULA issue was held on 25 May 2017.
At that meeting, at which
representatives of other trade unions were
also present, the parties agreed terms of reference in principle, and
a process that
would include the union making a presentation to the
task team on IGULA, including its structure, rules, governance
investment
market performance and benefits.
[19] On 21 June 2017, the terms of
reference for the IGULA task team were signed. It was specifically
recorded that the terms of
reference do not constitute an amendment
or variation to the wage agreement, the provisions of which would
continue to apply for
the duration of that agreement. The problem
statement recorded in the terms of reference is to the effect that
the union has established
a provident fund called IGULA to which it
would like the contributions of its members in the provident fund and
the new fund to
be transferred to it, as it believes they would
receive better service under the IGULA fund. The task team was to
make recommendations
to the central bargaining forum.
[20] Amplats avers that it had
concerns that IGULA had just been registered and that it would not be
able to make a presentation
on its performance since it had yet to
enrol members. IGULA nonetheless gave a presentation to the task team
on 28 June 2017 during
which it emerged that it was only
provisionally registered and that while an administrator had been
appointed, it was unable to
provide a total cost for consultancy,
investment and portfolio performance fees. Amplats raised the concern
that the task team
had been established on the premise that IGULA was
an existing and fully operational fund, but that did not appear to be
the case.
[21] In the context of it appearing
that IGULA was not an operational fund, Amplats states that it gave
consideration to assessing
various funds on the market outside of the
task teams. It had particular concerns about instability within the
AGPF, not least
because of press reports published during April 2017
which disclosed that some R472 million of assets were unaccounted for
consequent
on the mismanagement and misappropriation of funds in the
Bophelo Beneficiary Fund, appointed by the AGPF board in 2009 to
administer
death benefits on behalf of the minor children of deceased
employees. In addition, during November 2016, Amplats had been forced
to litigate against the AGPF. In the light of these and other
concerns, consideration was given to Old Mutual, but on the basis
that Amplats would competitively assess proposals from that company
and other available and reputable funds in the market, with
IGULA
also being included for consideration pursuant to the task team
process.
[22] Further meetings of the task team
and bilateral meeting between the union and Amplats took place during
September and November
2017, with the union not being in a position
to make a presentation on IGULA by the end of November, when it was
decided to disband
the task team on account of IGULA not being
operative, resulting in the inability of the task team to make the
comparisons envisaged
by the terms of reference.
[23] On 11 December 2017, after the
task team had been disbanded, Amplats’ executive committee
supported a move from AGPF
to Old Mutual, which had emerged as the
front-runner. Amplats states that this occurred in circumstances
where it had become apparent
from the task team process that IGULA
(which was not operational) did not appear to be a viable option.
[24] On 13 March 2018, a meeting was
convened with the union in which Amplats conveyed that it proposed to
have employees on AGPF
join Old Mutual, with effect from 1 June 2018.
Amplats also conveyed that it had invited a number of commercial
umbrella funds
to be independently evaluated. The union indicated
that it would like an opportunity to make a presentation on the IGULA
fund,
a proposal to which Amplats agreed, placing the proposed
appointment of Old Mutual on hold.
[25] On 14 March 2018, Amplats
addressed a letter to the union in which it agreed to share with the
union the information that was
shared with Old Mutual and other
prospective funds, provided that a confidentiality agreement was
signed. The confidentiality agreement
was subsequently signed by all
parties.
[26] A meeting was then to be
scheduled between the union and Amplats for the union to make a
presentation on IGULA. Little progress
was made and on 2 April 2018,
Amplats addressed a letter to the union stating as much, and in
particular, recording that IGULA
had been deliberated on extensively
in the task team, that Amplats had agreed to allow the union to
present IGULA again and that
Amplats had submitted all requested
information. The letter requested that the meeting date be confirmed
by 10 April 2018, failing
which Amplats would proceed with the
implementation process. A deadline of 18 April 2018 was later fixed
for the presentation.
The presentation was not made by 18 April and
after a further confirmation from the union that the presentation
would be ready
on 4 May 2018, it was agreed that a meeting would take
place on that date in order for the union to present IGULA.
[27] After further correspondence, on
4 May 2018, the union made a presentation on IGULA. PWC and RisCura,
the two entities that
had evaluated the proposals of the other
umbrella funds, were invited to the meeting to evaluate the union’s
presentation.
PWC was appointed to provide a high-level comparison
between proposals submitted by the service providers, with regards
particularly
to retirement fund administration, generic risk benefits
investment options, fees and associated costs. RisCura was appointed
from
an investment objective, investment track record, multi-manager
status perspective, fees, post-retirement solutions as well as to
give consideration to the availability of smoothing and capital
guarantees. PWC and RisCura independently assessed the IGULA
presentation.
IGULA was to the bottom-end of the rankings compared
with other funds. Old Mutual performed significantly more favourably,
and
also as the most cost-effective fund.
[28] Amplats subsequently met with
AMCU on 15 May 2018 when AMCU was advised, amongst other things, that
Amplats would not appoint
IGULA as an alternative fund, on the basis
of a number of concerns that it expressed, including the fact that it
did not have exposure
to a broad range of participating employers
across all industries in the market, that there were no reserves or
contingencies,
its lack of a clear investment strategy, its higher
administration expenses and costs and the lack of experience of its
current
trustees.
[28] On 17 May 2018 Amplats addressed
a letter to AMCU, referring to the meeting held on 15 May and
providing a summary of that
meeting. The letter recorded that on
account of privacy-related concerns, PWC and RisCura were unable and
unwilling to provide
a report to the union, as it had requested.
[29] The present application was filed
on 28 May 2018.
The
contractual issue
[30] The question raised for decision
here is whether Rusplats breached the contracts of employment of the
union’s members
by requiring them to change to Old Mutual or,
put another way, whether the terms of the contracts permit Rusplats
to require its
employees to change from AGPF to Old Mutual without
the employees’ consent. The union contends that the change of
the retirement
fund is a unilateral change to the terms and
conditions of employment of the union’s members. It should be
recalled that
the union’s claim regarding the contractual issue
is one that serves before the court in terms of s 77(3) of the BCEA.
It
follows that the issue falls to be determined by the law of
contract, and not the LRA or any precepts of what might be considered
to be good industrial relations practice.
[31]
A unilateral change to a contract of employment, as with any
contract, ordinarily amounts to a breach of the contract and affords
the aggrieved party the contractual remedies of specific performance
or cancellation and damages (see
Abrahams
v Drake and Scull Facilities Management (SA) Pty Ltd
(2012) 33
ILJ
1093 (LC)).
[32] As a general rule, an employer
who wishes to effect changes to an employee’s terms and
conditions of employment is required
to obtain the employee’s
consent. This is ordinarily effected by agreement with the individual
concerned. Where the employee
is represented by a bargaining agent in
the form of a trade union, any changes to terms and conditions are
regulated at a collective
level and must necessarily be effected
through the process of collective bargaining. In general terms, that
process must be exhausted
before any unilateral change can be made by
the employer which at this stage, subject to the protection granted
by s 64(4) of the
LRA, constitutes a legitimate exercise of economic
power.
[33]
But the union’s case in respect of the contractual issue (as it
must be where s 77 (3) of the BCEA is the basis on which
jurisdiction
is founded) is not one that concerns the collective realm – the
union contends that by changing to Old Mutual,
Rusplats has breached
the individual employment contracts of its members. The key issue
therefore is whether Rusplats has the right,
as a term and condition
of the contract, to require the union’s members to change to
Old Mutual (or to any other fund nominated
by it). Put another way,
do the contracts afford Rusplats the prerogative to determine which
fund its employees must join?
[34]
Rusplats contends that the terms of the contracts, properly
interpreted, are such that it has the prerogative to require its
employees to change from AGPF to another fund. As I have indicated
above, there are four iterations of the clause regulating retirement
funding. In my view, they all contain wording consistent with
Rusplats having the prerogative to determine and vary which fund
to
which its employees belong. The first contract provides for the
employee to “
join and conform with
the rules of any pension or provident fund
nominated
by
the company for the benefit
of employees in the service of the company from time to time”
,
and provides that “
[i]n the event
that the company
nominates
a different pension or provident fund, you shall be notified and you
will be required to transfer to the new fund”
(emphasis added). The second contract provides for the employee to
“
become a member of the company’s
retirement/provident fund (defined contribution) or any other fund
established by
the company from time to time”
(emphasis added.)The third contract provides for the employee to
“
join and conform with the rules
of any pension or provident fund or insurance arrangement or medical
aid or benefit society
nominated
by the company and established for
the benefit of employees in the service of the company”
(emphasis added.)The fourth contract provides for the employee to
“
become a member of the company’s
retirement/provident fund (defined contribution) or any other fund
established by
the company from time to time”
(emphasis added.)
[35]
The interpretative exercise to be undertaken is that set out by the
SCA in the well-known judgment in
Natal
Joint Municipal Pension Fund v Endumeni Municipality
2012 (4) SA 593
(SCA). At para 18, the court said the following:
Interpretation
is the process of attributing meaning to the words used in a
document, be it legislation, some other statutory instrument,
or
contract, having regard to the context provided by reading the
particular provision or provisions in the light of the document
as a
whole and the circumstances attendant upon its coming into existence.
Whatever the nature of the document, consideration must
be given to
the language used in the light of the ordinary rules of grammar and
syntax; the context in which the provision appears;
the apparent
purpose to which it is directed and the material known to those
responsible for its production. Where more than one
meaning is
possible each possibility must be weighed in the light of all these
factors. The process is objective, not subjective.
A sensible meaning
is to be preferred to one that leads to insensible or unbusinesslike
results or undermines the apparent purpose
of the document. …
The 'inevitable point of departure is the language of the provision
itself', read in context and having
regard to the purpose of the
provision and the background to the preparation and production of the
document.
[36]
With reference to the first contract, the union contends that the
word ‘nominated’ is not the same as ‘determined’,
and that this is in any event different to the concept of a
prerogative. The word ‘nominate’ is defined in the
Shorter
Oxford English Dictionary to mean ‘to name, fix,
appoint, specify’. In the new Oxford Dictionary of English,
‘nominate’
is defined to mean ‘appoint to a job or
position’. Bryan Garner, in a
Dictionary of Modern Legal
Usage
(OUP, 1995) says the following:
Nominate, in the lawyers vocabulary,
is often a highfalutin substitute for
name
, v.t. E.g., “In
case the testator
nominates
[read
names
] no executor,
or if for any reason the person
nominated
[read
named
]
does not act, the court will appoint someone to perform the same
functions…
[37]
These definitions all denote a prerogative on Rusplats’s
part to name or determine (and vary) the provident fund to which its
employees are required to belong. There are no contextual factors or
other considerations pointing to a different construction.
In
particular, there are none that point to the construction for which
the union contends.
[38]
Turning to the second contract, the union contends, with reference to
the provision for employees to be members of a fund ‘established
by the company’, that this wording does not envisage a
provident fund other than one established by the first or second
respondents, and that since Old Mutual is not a fund established by
either of them, the contracts do not entitle the respondents
to
require employees to join that fund
.
The union makes the same
contention regarding the third contract and the fourth contract.
[39]
There is no merit in this submission. First, participation in an
umbrella fund such as Old Mutual is initiated by the registration
of
special rules applicable to the employer. Participation in such a
fund through the registration of special rules, establishes
the
sub-fund applicable to the employer concerned, rendering it a fund
established by the employer.
Secondly, it is a
misnomer that a fund could, in literal terms, be established by an
employer. A fund comes into existence through
its registration in
terms of s 4 of the PFA.
A precondition for registration under
section 4 is that the entity that seeks registration must qualify as
a pension fund organisation
as defined in section 1 of the PFA. It is
thus the fund itself that applies for registration. Thirdly, an
umbrella fund is ‘established’
for the benefit of the
employees of a participating employer. Section 7B(1)(b)(ii) of the
PFA, which is applicable when an umbrella
fund seeks an exemption
from the requirement that a fund have member-elected trustees,
expressly provides that it is applicable
to an umbrella fund which
“
has been established for the benefit of employees of
different employers which are not subsidiaries of a single holding
company”
(own emphasis). Similarly, regulation 30 of the
Pension Funds Regulations requires that the rules of a fund provide
for –
(t)
a specific indication of the participation in the pension fund so as
to differentiate between
pension funds established for the benefit
of
-
(i)
employees of a principal employer and its subsidiaries;
(ii)
employees of various employers
that do not fall within the
ambit of subparagraph (i) above; and
(iii)
persons not referred to in either subparagraph (i) or (ii) above”.
(Emphasis added.)
[40]
Consistent with this, s 1 of the Income Tax Act defines a provident
fund (with the definition of a pension fund being substantially
similar) in these terms, confirming that by their nature, all such
funds are established by an employer for the benefit of its
employees:
…
a
permanent fund
bona
fide
established
solely for the purpose of providing benefits for employees
on retirement date or solely for the purpose of providing benefits
for the dependants or nominees of deceased employees or deceased
former employees or solely for a combination of such purposes or
mainly for the said purpose and also for the purpose of providing
any
benefit contemplated in
paragraph 2C
of the
Second Schedule
or
section 15A
or 15E of the
Pension Funds Act”. (Emphasis added.)
[41]
In short, the union’s construction is not in keeping with the
statutory context, including the provisions of the PFA,
its
regulations and the Income Tax Act. Adopting the construction for
which the union contends would, in the words of
Endumeni
Municipality
, be ‘insensible [and] unbusinesslike’,
[42]
The provisions of chapter 5 of the employment manual support the same
conclusion. Being the central repository of all conditions
of
employment at Rusplats, it is an important interpretive tool in
determining the purpose to which the relevant contractual provisions
are directed. As I have recorded above, the manual reads “
As
a condition of employment, all enrolled (permanent) Anglo Platinum
employees must become a member of a Retirement/Pension/Provident
Fund
as determined by the company
.
”
(Emphasis added.)
[43]
Further, the rules of the AGPF (which are also part of the relevant
contextual material) provide for Rusplats to choose to
terminate
participation in the AGPF and participate in another fund. At the
very least, this gives rise to an implied contractual
term affording
Rusplats the prerogative to determine the provident fund of which its
employees are to be members.
[44]
Taking all of these instruments into account, in my view, Rusplats
retains the prerogative in terms of the contracts of employment
of
each of the union’s members to determine the provident fund to
which its employees are required to belong. That being
so, Rusplats
did not breach the terms of the contracts when it required the
union’s members to join Old Mutual.
[45]
To the extent that the union avers, as it does in the founding
affidavit, that a change of retirement fund is a change to the
term
and conditions of an employment contract which requires at the very
least ‘
proper and transparent consultations prior to any
changes being made
’, it follows from the above finding that
Rusplats was in law not required to consult with the union before
implementing the
change. The subject of the change cannot give rise
to any legal obligation to consult. What matters in contractual terms
is whether
the employer is permitted to effect the change without
securing the employee’s prior consent. For the reasons recorded
above,
in this instance, it is.
The s 24 dispute.
[46] In essence, the union contends
that Amplats breached the wage agreement (and in particular, clause
34, the peace obligation),
because it entered into negotiations, or
made further demands or proposals, relating to terms and conditions
of employment that
would apply during the period of the wage
agreement, in the form of a change in provident fund.
[47] It will be recalled that AMCU’s
demand that its members be changed from AGPF to IGULA was not acceded
to. The extent
of the agreement between the parties, as reflected by
clause 29 of the wage agreement, was to refer the issue to a joint
task team
for discussion. The terms of the peace obligation, as well
as the task team’s terms of reference, make it clear that the
issue of a change to IGULA was taken out of the realm of collective
bargaining and consigned to a process of discussion.
[48] Clause 32 of the wage agreement
records that the agreement is entered into in full and final
settlement of all demands, proposals
and counter-proposals made by
the parties (defined on the title page to mean the union and
Rusplats) during the negotiation. Consistent
with that, clause 31
requires that ‘no party’ is entitled to embark on any
industrial action in respect of wages, issues
referred to task teams
and any other conditions of employment or benefits in addition to
those agreed. These limitations against
industrial action clearly
extend to both Rusplats and AMCU. What follows in clauses 32 and 33
is a series of clear and deliberate
unilateral limitations on AMCU’s
right (and that of its members) both to call for strike action in
respect of issues regulated
by the wage agreement, or which formed
the subject of proposals or counter-proposals during the negotiation.
Clause 33 prohibits
a re-opening of the negotiations on those terms
and conditions of employment regulated by the wage agreement, and the
making of
other demands or proposals that during the period of the
agreement would increase employment costs.
[49] The only limitation that the
peace obligation imposes on Rusplats is the prohibition against
embarking on any industrial action
in respect of wages, issues
referred to process or task teams, and any other conditions of
employment or benefits in addition to
those agreed by the parties.
The union does not contend that Rusplats has embarked on industrial
action in respect of any of these
issues, or for that matter, any
other issue.
[50] In my view, none of the
limitations established by the peace obligation can be read so as to
preclude Rusplats from effecting
any change to the terms of the union
members’ employment contracts, at least not in circumstances
where the contracts themselves
allow that change. In short, by
requiring the union’s members to join Old Mutual, Rusplats did
not breach the wage agreement.
Breach of the duty to bargain in
good faith
[51] Much of the union’s case
involves averments of bad faith bargaining, in one form or another,
on the part of the respondents.
Although this is not a discretely
articulated cause of action, it is a theme that underpins the union’s
allegations of Rusplats’s
breach of the wage agreement if not
in letter, then in spirit, and its contention that the respondents
undermined the collective
bargaining relationship that exists between
the parties. Central to these averments is the decision by the
respondents to engage
in what is described as a parallel process of
participation in the task team established by the wage agreement on
the one hand,
and a separate and secretive process that involved
invitations to umbrella funds on the other. Particular complaints
relate to
the respondents engaging in the assessment of umbrella
funds without advising the union and in parallel to the task team
process,
by failing to engage the task team in this regard and by
withholding information from the union.
[52] Much of the union’s case is
made by inference, and specifically by reference to the chronology of
events between mid-July
2016 when the union first raised the prospect
of a transfer to IGULA, through the deliberations of the task team
until 25 May 2017,
when the AGPF was advised of the change to Old
Mutual once the process contemplated by s 14 of the PFA had been
completed. Insofar
as there is are factual disputes in relation to
this issue, in accordance with the
Plascon Evans
rule, these
stand to be resolved in favour of the respondents. As set out in the
chronology above, the respondent’s position
during the wage
negotiations was that it had the prerogative to determine which
provident fund its employees should join, but that
it was prepared to
consider IGULA. After the conclusion of the wage agreement (and thus
the end of the collective bargaining process),
the task team
continued discussions with the mandate to compare and assess IGULA
against the existing funds, with a view to the
respondents
considering IGULA. Although this is disputed by the union, I must
accept that the task team’s deliberations were
unsuccessful on
account of the fact that IGULA was not fully operational.
[53] The respondents say that in
circumstances where they had serious concerns about the AGPF at the
time, and where it transpired
that IGULA was not an operational
umbrella fund, they undertook an assessment of various funds. On 11
December 2017, after the
task team had been disbanded, it was decided
to support the appointment of Old Mutual. Also significant are the
events that ensued.
On 13 March 2018, Amplats advised AMCU of the
proposed appointment of Old Mutual but agreed to IGULA being offered
an opportunity
to present a bid on the same terms that the other
funds had done. On 4 May 2018, the union made a presentation on IGULA
in circumstances
where the appointment of Old Mutual was held in
abeyance. The IGULA proposal was evaluated by the same independent
advisers who
had evaluated all of the other bids and on 15 May 2018,
the union was advised that the IGULA bid had been unsuccessful,
further
to which Old Mutual was appointed.
[54] I fail to appreciate how in these
circumstances it can be said that the respondents acted in bad faith.
But there is a more
fundamental hurdle faced by the union in regard
to this aspect of its claim. The LRA does not compel bargaining, even
less so does
it require any party to a collective bargaining process
to bargain in good faith. The absence of any statutory duty to
bargain
in good faith was a conscious policy choice. The model that
finds expression in the LRA is one which allows parties, through the
exercise of power, to determine their own arrangements. It avoids the
rigidities that might be introduced by way of judicial intervention
should an obligation to bargain in good faith be legally enforceable
(see the ‘Explanatory Memorandum’ published in
(1995)16
ILJ
at 292). This court has on numerous occasions held that it
will not subject the conduct of collective bargaining partners to
scrutiny,
unless they act unlawfully. In
SA Municipal Workers
Union & another v SA Local Government Association & others
(2010) 31
ILJ
2178 (LC), this court said (at paragraph 16 of
the judgment):
The
LRA introduced a voluntarist system of collective bargaining, a
system in which neither this court (nor any other court or tribunal)
is empowered to scrutinize bargaining conduct or make pronouncements
on the good faith or otherwise exhibited by the any of the
parties to
collective bargaining…
[55] This approach was recently
reinforced by the Constitutional Court in
National Union of Public
Service & Allied Workers on behalf of Mani & others v
National Lotteries Board
(2014) 35
ILJ
1885 (CC), where
Zondo J (as he then was) said the following (at paras 193-4):
A
trade union has a right to determine its own strategies and tactics
in dealing with an employer concerning grievances, or complaints,
disputes of right or disputes of interest, and generally, on how to
handle consultations, negotiations, discussions and collective
bargaining with an employer. It is not for a court to dictate to the
trade union how to handle its discussions or negotiations
with an
employer or what tactics and strategies it should use and at what
stage it should use them in its dealings with an employer….
The same can be said of an employer or an employers’
organisation as well.
[56] In short: in the absence of a
legally enforceable duty to bargain in good faith, this court is not
empowered to subject the
lawful acts of collective bargaining
partners to scrutiny by reference to any standard of good faith.
Disclosure
[57] In the notice of motion, the
union seeks an order to the effect that the respondents make
available to the union any report
prepared by PWC and RisCura in
respect of their evaluations of the respective provident funds. In
terms of the founding affidavit,
this prayer would appear to relate
to the averment that there has not been proper compliance with the
provisions of the PFA. In
particular, the union avers that it has
raised objections to the proposed transfer which have not been
resolved. It states further
that it has been prevented from making
informed objections by the respondents’ refusal to provide it
with all relevant information.
[58] After the filing of the present
application and the order granted by this court on 30 May 2018, the
union filed a notice in
terms of Rule 35 (12) of the Uniform Rules
(read with Rule 11 of the Rules of this court) requiring the
respondents to produce
for inspection all documentation relating to
the appointment of PWC and RisCura, and copies of the assessments
done by these entities.
In its response, the respondents aver that
the documentation sought is not referenced in the paragraphs
concerned, and accordingly
refused to provide it. In addition, the
respondents observed that the applicant had in any event sought
access to the documentation
as primary relief in the notice of
motion, and that detailed reasons for the refusal to provide the
documentation had been provided
in the answering affidavit. That
notwithstanding, on 25 June 2018, shortly before the hearing of this
application, the applicant
filed an application in terms of Rule 35
(12) of the Uniform Rules seeking an order that the respondents be
directed to provide
copies of the documentation sought.
[59] Rule 35 (12) states:
Any
party to a proceeding made any time before the hearing thereafter
liver notice as near as may be in accordance with form 15
in the
first schedule to any other party in whose pleadings or affidavits
references made to any document tape-recording to produce
such
document or tape recording for his inspection and to permit him to
make a copy will transcription thereof. Any party failing
to comply
with such notice shall not, save with the leave of the court, use
such document or tape recording in such proceeding
provided that any
other party may use such document or tape recording.
[60] Rule 30A reads:
(1)
where
a party fails to comply with these rules or with the request made or
notice given pursuant thereto, in the other party may
notify the
defaulting party that he or she intends, after the lapse of 10 days,
to apply for an order that such rule, notice or
request be complied
with or that the claim or defence be struck out.
(2)
Failing
compliance within 10 days, application may unnoticed be made to the
court and the court may make such order thereon as it
deems meet.
[61] In
Centre for Child Law v
Hoërskool Fochville and Another
2016 (2) SA 121
(SCA), the
Supreme Court of Appeal recently affirmed that the self-contained
sanction in Rule 35 (12), being of a negative nature,
is one that
comes into effect automatically upon non-compliance with the Rule.
But where a party who gives notice under Rule 35
(12) is not content
with the negative sanction and seeks production of the documents
concerned, then it is for that party to give
notice in terms of Rule
30A that it intends, after the lapse of 10 days, to apply for an
order compelling compliance with its Rule
35 (12) notice. The
respondents contend that the Rule 35 application is thus defective,
in that the appropriate mechanism through
which a party may seek to
compel another to produce documents in terms of Rule 35(12) is Rule
30A. This contention is unassailable.
In the absence of an
application in terms of Rule 30A, there is no basis on which the
court is empowered to grant the relief sought.
[62] In any event, there is the
further point of a conflict of interest on the part of the union,
alluded to in the answering affidavit.
There the respondents point
out that the union has no entitlement to the reports and has failed
to set out any legal basis as to
why the respondents are obliged to
furnish the union with them. In any event, they note that PWC and
RisCura are unable and unwilling
to release the report to the union.
The respondents aver that the material issues around the confidential
information contained
in the report and in view of its impact on
third parties and conflict of interest in which the union finds
itself, the union is
not entitled to the information. The respondents
point out that the union is a sponsor of the IGULA fund and that its
officials
sit as trustees of that fund. To the extent that IGULA was
invited to submit a proposal for adjudication, along with other
proposals
from other sponsors of umbrella funds, this formed part of
a competitive process where the sponsors advanced their offerings
based
on what they perceive to be their competitive advantages. No
party to this process has had sight of any other sponsors proposals,
and no party is able to use the competitive information contained in
their proposal to compete with others. If the confidential
information sought would be provided to the union, this would serve
to provide IGULA with a competitive advantage. Further, there
is the
issue of relevance. The dispute between the parties is crystallized
into the two primary issues referred to above, these
being the
alleged breach by the respondents of the wage agreement and the
contracts of employment of the union’s members.
I fail to
appreciate how reports by independent advisers on the merits of the
competing proposals by umbrella funds seeking to
be appointed in the
place of the AGPF are in any way relevant to a determination of
either of these issues.
[63] For these reasons, the Rule
35(12) application is dismissed.
Summary
[64] The union has failed to establish
either that by requiring its members to change to Old Mutual, the
respondents have breached
the wage agreement, or that Rusplats has
breached the contracts of employment between it and the union’s
members. For the
purposes of the present application, in which the
union seeks final relief, there is therefore no clear right to the
relief sought.
That being so, the application cannot succeed.
Costs
[65]
The respondents charitably did not seek an order for costs.
I make the following order:
1.
The application is dismissed.
André van Niekerk
Judge
REPRESENTATION
For the applicant: Adv. M Lennox,
instructed by Botoulas Krause Da Silva Inc. Attorneys
For
the first and second respondents: Adv. AT Myburgh SC, with him Adv. R
Itzkin, instructed by ENS Africa Inc.