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[2018] ZALCJHB 261
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Trans Caledon Tunnel Authority SOC Limited v Bleeker and Others (JR1249/16) [2018] ZALCJHB 261 (15 August 2018)
THE
LABOUR COURT OF SOUTH AFRICA, JOHANNESBURG
Not
Reportable
Case
no: JR1249/16
In
the matter between:
TRANS
CALEDON TUNNEL AUTHORITY SOC
LIMITED
Applicant
and
CARINA
BLEEKER
First
Respondent
RONEL
DE
WET
Second
Respondent
COMMISSION
FOR CONCILIATION MEDIATION
AND
ARBITRATION
Third
Respondent
Heard:
02 May 2018
Delivered:
15 August 2018
Summary:
Review application – failure to renew a fixed-term contract
when reasonable expectation was justified.
Unfair
labour practice – unpaid performance related bonus –
decision to moderate the final performance appraisal score
was
arbitrary and capricious.
JUDGMENT
NKUTHA-NKONTWANA.
J
Introduction
[1]
In this
application the applicant seeks an order reviewing and setting aside
the arbitration award issued by the second respondent
(commissioner)
under case number GATW14482/15, dated 27 May 2016. The commissioner
found, firstly, that the applicant’s failure
to renew the first
respondent’s (Ms Bleeker) fixed-term contract constitutes a
dismissal in terms of
section
186(1)(b) of the Labour Relations Act (LRA);
[1]
and, secondly, that the decision not to pay Ms Bleeker her bonus that
was due when her fixed-terms contact terminated constitutes
an unfair
labour practice in terms of section 186(2)(a) of the LRA. Ms Bleeker
is defending the award.
[2]
The
application is essentially hinged on the following grounds:
2.1.
That the
commissioner incorrectly found that Ms Bleeker was dismissed when she
had failed to prove that she had a reasonable expectation
as required
by section 186(1)(b);
2.2.
That the
commissioner failed to apply her mind to the evidence before her that
Ms Bleeker was not entitled to a bonus due to her
rating falling
below 3.2 threshold;
2.3.
That the
commissioner created a perception of bias through her conduct by
upholding Ms Bleeker’s objections whilst dismissing
the
applicant’s objections;
2.4.
That the
commissioner incorrectly drew a negative inference when the applicant
failed to call the Chief Executive Officer (CEO),
Mr James Ndlovu,
and the Chief Operations Officer (COO), Ms Jeanette Nhlapo, as
witnesses;
2.5.
That the
commissioner failed to apply her mind to the evidence that was before
her by ignoring inconsistencies in Mr Bleeker’s
evidence and
accepting hearsay evidence in relation to the applicant’s
practice when it comes to renewal of fixed-term contracts.
Factual
background
[3]
The facts
in this matter are mostly common cause and are outlined with
meticulous detail in the award. I do not wish to repeat them
save to
highlight those that are pertinent.
[4]
Ms Bleeker
had been in the employ of the applicant for 18 years at the time of
her dismissal. Prior to 2010 her employment was permanent.
In 2010
she applied for the position of Manager: Enterprise Wide Support
Service (EWSS) and was appointed on a five year fixed-term
contract,
commencing from 1 September 2010. This position was permanent when it
was created in 2003 and was called Corporate Affairs
Manager then.
[5]
In 2009 the
applicant’s Board of Directors decided to convert the position
from permanent to a fixed-term of five years. In
fact, it was the
applicant’s evidence that the Board’s decision affected
all executive positions in order to allow
rotation of executives
within the roles. Nonetheless, the nature of the position remained
permanent.
[6]
Naturally,
Ms Bleeker was concerned about the impending expiry of her fixed-term
contract and approached the Human Resources Manager,
Mr Mabena, for
advice sometime in June 2015. She was advised to draft a motivation
to the CEO for the renewal of her contract,
which she did on 15 June
2015. The only feedback she received in that regard was that the CEO
was still pondering on the request.
[7]
On 5 August
2015, whilst waiting for the response on her expiring fixed-term
contract, Ms Bleeker received an instruction from the
CEO to attended
a workshop that was scheduled to take place on 30 September 2015 to 1
October 2015. Clearly, this engagement fell
outside the term of Ms
Bleerker’s contract.
[8]
On 18
August 2015, Ms Bleeker was advised that her contract would be
extended for a month and shall terminated on 30 September 2015.
No
reason was proffered for the decision not to renew Ms Bleeker’s
contract. Ms Bleeker was adamant in her evidence that
the applicant
had been renewing executive managers’ fixed-term contracts as a
matter of practice. She was the only one whose
contract was not
renewed. This evidence was not disputed.
[9]
At the time
of Ms Bleeker’s termination, she was due for a performance
bonus. The performance appraisal started before 30
September 2015.
In the EXCO meeting of 7 August 2015, Ms Bleeker and her colleagues
were informed that the scores had already
been allocated and that
there would be one on one feedback discussion. Ms Bleeker’s
contract was terminated before she could
receive feedback as
promised.
[10]
Ms Bleeker
never received her bonus and upon enquiry she was informed that she
was not eligible as her score had been moderated
down from 3.75 to
3.1. She need to score 3.2 on order to qualify for a bonus. The
applicant had unilaterally decided to moderate
the score. Mr Moledi,
the head of internal audit, testified that the moderation of Ms
Bleeker’s score was informed by, firstly,
the performance
targets she failed to meet; secondly, the organisational fruitless
and wasteful expenditure that was apportioned
to each division; and
lastly, the investigation of the fixed assets that was pending at
that time.
Review
test
[11]
The review
test as postulated in
Sidumo
and Another v Rustenburg Platinum Mines Ltd and Others
[2]
had been expounded in various Labour Appeal Court cases and
simplified in
Head
of the Department of Education v Mofokeng
[3]
as follows:
‘
[30] The failure by an
arbitrator to apply his or her mind to issues which are material to
the determination of a case will usually
be an irregularity.
However, … this court in
Gold
Fields
… held that
before such an irregularity will result in the setting aside of the
award, it must in addition reveal a misconception
of the true enquiry
or result in the setting aside of the award. It must in
addition reveal a misconception of the true enquiry
or result in an
unreasonable outcome…
[31] … Moreover, judges of the
Labour Court should keep in mind that it is not only the
reasonableness of the outcome which
is subject to scrutiny. As
the SCA held in
Herholdt
,
the arbitrator must not misconceive the inquiry or undertake the
inquiry in a misconceived manner. There must be a fair
trial of
the issues.
[32] … To repeat: flaws in the
reasoning of the arbitrator, evidenced in the failure to apply the
mind, reliance on irrelevant
considerations or the ignoring of
material factors etc must be assessed with the purpose of
establishing whether the arbitrator
has undertaken the wrong inquiry,
undertaken the inquiry in the wrong manner or arrived at an
unreasonable result …
[33] Irregularities or errors in
relation to the facts or issues, therefore, may or may not produce an
unreasonable outcome or provide
a compelling indication that the
arbitrator misconceived the inquiry. In the final analysis, it
will depend on the materiality
of the error or irregularity and its
relation to the result. Whether the irregularity or error is
material must be assessed
and determined with reference to the
distorting effect it may or may not have had upon the arbitrator’s
conception of the
inquiry, the delimitation of the issues to be
determined and the ultimate outcome. If but for an error or
irregularity a different
outcome would have resulted, it will
ex
hypothesi
be material to the determination of the dispute.’
Evaluation
[12]
The first
enquiry in this matter pertains to whether there was dismissal as
defined as follows in terms of section 186(1)(b):
‘
(1) Dismissal means that-
(a) ...
(b) an employee reasonably expected
the employer to renew a fixed-term contract of employment on the same
or similar terms but the
employer offered to renew it on less
favourable terms, or did not renew it.’
[13]
Ms Bleeker
bore the onus to prove that she had been dismissed by establishing
that she held a reasonable expectation that her fixed-term
contract
would be renewed.
[4]
The
commissioner was in turn required to determine whether on the facts
before her, objectively considered, it had been established
that Ms
Bleeker held a reasonable expectation that her contract would be
renewed.
[5]
[14]
The
commissioner correctly found that Ms Bleeker held an expectation that
her contract would be renewed. The CEO had a discretion
to renew the
contract at the end of the term and he decided otherwise, contrary to
the practice. The applicant took issue with
the admission of the
evidence on discrepancies in relation to the manner in which the
applicant handled the renewal of fixed-term
contracts. However, this
point is untenable as the applicant doesn’t dispute that there
were other fixed-term contracts that
had been renewed.
[15]
It is also
common cause that the reason for fixing the term of executive
manager’s employment contracts was to allow for rotation.
Even
though, no evidence was led on how the rotation was intended to
happen, it is inconceivable that the applicant would decide
not to
renew Ms Blekeer’s contract when she had been in its employ for
18 years and the position was in any event available
post the term of
her contract.
[16]
It follows
that Ms Bleeker’s expectation that her fixed-term contract
would be renewed was justified. The commissioner
was correct in her
finding that the applicant’s failure to renew the employment
relationship constitutes an unfair dismissal.
[17]
Consequent
to the commissioner’s finding that the requirements of
s186(1)(b) had been fulfilled and Ms Bleeker had been dismissed,
the
onus of proof shifted to the applicant. It had to establish that the
dismissal was both procedurally and substantively fair.
The applicant
chose not to lead any evidence in that regard. Since Ms Bleeker dealt
directly with the CEO and COO, they were the
only people who could
shed some light as to why her contract was not renewed. The
commissioner was on point in drawing an adverse
inference from the
failure to lead evidence of these two critical witnesses overall.
[18]
Nothing
turns on the extension of the contract by a month other than
extending the terms of the contract that was not renewed. Therefore,
there were no two fixed-term contracts as contended by the applicant.
[19]
Turning to
the section 186(2)(b) dispute in relation to the unpaid bonus, it is
clear that the applicant did not communicate the
reasons for
moderating Ms Bleeker’s performance appraisal score or afford
her an opportunity to challenge the decision. What
is apparent from
Ms Bleeker’s undisputed evidence is that she had been engaging
the CEO on the obstacle that could have impacted
on her performance
and had been assured that those issues would be factored during
performance appraisal.
[20]
Also,
without prior notice, Ms Bleeker could not have known that she was
going to be held responsible for the overall performance
of the
organisation, including the fruitless and wasteful expenditure. At
least, the applicant ought to have afforded Ms Bleeker
an opportunity
to be heard prior to taking the final decision not to pay her bonus,
a
well-entrenched benefit defined in
Apollo
Tyres South Africa (Pty) Ltd v Commission for Conciliation, Mediation
and Arbitration and
Others
[6]
as an ‘…existing
advantages or privileges to which an employee is entitled as a right
or granted in terms of a policy
or practice subject to the employer’s
discretion.’ Even though the employer has a discretion not to
pay a bonus, that
discretion must be exercised judiciously. In this
instance, Ms Bleeker was presented with a
fait
accompli.
[21]
In
the premise, it is my view that the applicant’s decision not to
pay Ms Bleeker her performance bonus
for
the financial year 2014/2015 is
arbitrary,
capricious and inconsistent with the constitutional imperatives.
[7]
The commissioner cannot be faulted in her finding in that regard.
[22]
Having
had regard to the transcript, I agree with Ms Bleeker’s counsel
that the applicant’s complaint that the commissioner
was bias
is ill-conceived. The applicant had declined an opportunity to
formally challenge the commissioner’s perceived bias.
In any event, to succeed,
the applicant had to establish that there was a reasonable suspicion
of bias on the part of the commissioner.
[8]
I am not convinced that the manner in which the commissioner
conducted the proceedings created a justifiable impression that she
was inclined to assist Ms Bleeker in putting her case and to
challenge the applicant’s case.
[9]
Conversely, the applicant’s representative, Mr Mabena, was not
conversant with the arbitration process and the commissioner
had to
be more inquisitorial without descending into the arena.
[23]
Ultimately,
the commissioner understood her role and exercised her discretion in
accordance with the three considerations stated
by the Constitutional
Court in
Commercial
Workers Union of SA v Tao Ying Metal Industries and Others,
[10]
to,
firstly,
resolve
the real dispute between the parties; secondly, to do so
expeditiously; and thirdly, to act fairly to all the parties. Also,
she studiously dealt with the issue of the relief.
Conclusion
[24]
In
all the circumstances,
the
commissioner’s findings cannot be faulted
and
the arbitration award falls within the ambit of reasonableness
required. The
application
stands to be dismissed.
[25]
Dealing
with the issue of costs, I have taken into account the state of the
record and the applicant’s attitude when it was
warned of the
inappropriateness of overburdening the Court with irrelevant
documents. Also, the applicant ought to have been better
advised on
the prospects of vainly challenging the award in the light of its
failure to lead evidence to prove that its decision
not extend Ms
Bleeker’s contract was procedurally and substantively fair.
Therefore, there is no reason in law and in fairness
why the
applicant should not pay Ms Bleeker’s legal costs.
[26]
In the
premises, I make the following order:
Order
1.
The
review application is dismissed with costs.
__________________
P
Nkutha-Nkontwana
Judge
of the Labour Court of South Africa
Appearances:
For
the applicant: Advocate Pranisha Pillay
Instructed
by: Selomo Attorneys Inc.
For
the first respondent: Johanette Rheeder of Johanette Rheeder
Incorporated
[1]
Act 66 of 1995 as amended.
[2]
(2007) 28 ILJ 2405 (CC).
[3]
Mofokeng
[2015] 1 BLLR 50
(LAC) at paras 30 to 33; see also
Herholdt
v Nedbank Ltd (Congress of South African Trade Unions as amicus
curia)
[2013] 11 BLLR 1074
(SCA).
[4]
Section 192 of the LRA states:
‘
(1)
In any proceedings concerning any dismissal, the employee must
establish the existence of the dismissal.
(2)
If the existence of the dismissal is established, the employer must
prove that the dismissal is fair.’
[5]
Ekurhuleni West
College v Education Labour Relations Council and Others
[2017] ZALAC 75
at
paras 17 and 18, see also
SA
Rugby Players’ Association v SA Rugby (Pty) Ltd
(2008) 29 ILJ 2218 (LAC) para 44
where the test is
articulated as follows:
“
The
enquiry is whether a reasonable employee, in the circumstances
prevailing at the time, would have expected the employer to
renew
his or her fixed term contract on the same or similar terms.”
[6]
[2013] 5 BLLR 434
(LAC) at para 50.
[7]
Supra
at paras 42 and 53. See also
NEHAWU
v University of Cape Town and Others
2003 (2) BCLR 154
(CC) at para 34.
[8]
BTR Industries SA (Pty) Limited
and Others v MAWU and Another
(1992) 13 ILJ 803 (A),
President of the Republic
of South Africa and Others v South African Rugby Football Union and
Others
(CCT16/98) [1999]
ZACC 11; 2000 (1) SA 1; 1999 (10) BCLR 1059.
[9]
Jansen v Commission for
Conciliation Mediation and Arbitration and Others
[2014] ZALCJHB at para 12.
[10]
[2008] ZACC 15
;
2009 (2) SA 204
(CC); (2008) 29 ILJ 2461 (CC) at para 65.