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[2018] ZALCJHB 381
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Gare v T-System South Africa (Pty) Ltd and Another (JS 426/11) [2018] ZALCJHB 381 (3 September 2018)
THE
LABOUR COURT OF SOUTH AFRICA, JOHANNESBURG
Not
Reportable
Case
no: JS 426/11
In
the matter between:
MOIPONE
GARE
Applicant
and
T-SYSTEM
SOUTH AFRICA (PTY) LTD
First Respondent
ARIVIA.KOM
(PTY) LTD
Second
Respondent
Heard:
13 to 16 August 2018
Submissions:
3 September 2018
Delivered:
21 November 2018
Summary:
Section 189A applicable – dismissal for operational
requirements consequent transfer in terms of section 197 of the
LRA.
JUDGMENT
NKUTHA-NKONTWANA.
J
Introduction
[1]
In this
action, the applicant, Ms Moipone Gare (Ms Gare), is challenging her
dismissal on the basis of the first respondent’s,
(T-System
South Africa (Pty) Ltd (TSSA)), operational requirements. She asserts
that her dismissal was procedurally and substantively
unfair because
it was not effected in accordance with section 189 of the Labour
Relations Act
[1]
(LRA).
[2]
TSSA is
objecting to this Court’s jurisdiction to deal with the
procedural challenge and it submits that Ms Gare’s dismissal
was consequent to a section 189A process. The number of employees in
its employ at the time were 2002 and it intended retrenching
50
employees.
[3]
These
proceedings sat over a period of four days, commencing from 13 to 16
August 2018. The parties agreed to file written submissions
and the
submissions were received by the Court on 3 September 2018. TSSA was
allowed to lead evidence by way of Skype video conferencing.
I,
however, deem it unnecessary to rule on the admissibility of this
evidence as nothing turns on it.
Background
facts
[4]
Ms
Gare was employed by the second respondent, Arivia.Kom (Pty) Ltd
(Arivia), a state owned information technology company which
came
into existence out of a merger between Datavia, Eskom ITS and Ariel
Technologies. Arivia was successfully procured by TSSA
in January
2010 and as a result of the merger of the two companies, Ms Gare and
all Arivia’s employees were transferred to
TSSA in accordance
with section 197 of the LRA.
[5]
During
the sale negotiations it was anticipated that there may be
redundancies as a result of the merger. As a result, Arivia and
TSSA
agreed to establishment a Career Centre as holding place for
employees affected by the integration. The Career Centre was
aimed at
assisting unplaced employees to secure alternative placement
internally or externally through,
inter
alia
,
reskilling and experience learning with salary guarantees up to 31
December 2010.
[6]
Ms
Gare remained unplaced after she unsuccessfully applied for the
position of DB2 Database Administrator, the same position she
was
occupying whilst still in Arivia’s employ, in September 2010.
She was immediately transferred to the Career Centre where
she
applied for other position that had been advertised internally
without success.
[7]
In
October 2010 she was informed that her position was redundant and was
issued with a section 189(3) notice. Ms Gare sought assistance
from
TSSA with her business initiative in order to mitigate the adverse
effect of the retrenchment to no avail. She was informed
that he
business initiative was not in line with TSSA’s core business.
[8]
On
26 October 2010, a consultation meeting was held with Ms Gare, at her
instance. In that meeting, other than being offered the
emotional
support in terms of TSSA’s wellnesses programme, none of the
issues referred to in terms of section 189(3) notice
were discussed.
This fact was conceded by Ms Charlene Benade, who was the Career
Centre Manager in Midrand and a scribe in that
meeting. Ms Gare
received a notice of termination on 26 November 2010 and her services
were terminated on 31 December 2010.
[9]
It
is common cause that Ms Gare was a member of South African Transport
and Allied Union (SATAWU). SATAWU had been consulted on
the
integration process and the placement model that was going to be
implemented. SATAWU was aware of the number of its members
that had
not been placed in terms of the integration process. Mr Keven Wilson
(Mr Wilson), the TSSA’ Employee Relations Consultant,
testified
that he was part of most consultations meetings with the general body
of employees and SATAWU, particularly. On 9 November
2010, he
provided SATAWU shop-stewards and officials with a list of SATAWU
members who were at the Career Centre at that time.
[10]
Despite
the fact that SATAWU members were issued with section 189(3) notices
individually and without notifying it, SATAWU did not
intervene. Even
when its members were subsequently served with notices of
termination, SATAWU did not object. Ms Gare was adamant
that she did
inform her shop-stewards about the conduct of TSSA and she was told
to wait up until 31 December 2010.
[11]
When
pushed by shops-stewards in January 2011, Mr Tinzi Lubabalo (Mr
Lubabalo), SATAWU official responded as follows:
‘
The
issue of retrenchment has been on the cards from T-Systems toward the
end of 2010. In light of the report that you forwarded
to us, it
becomes clear that the employer is executing its plan. Of course
SATAWU would not turn a blind eye and pretend as if
there is nothing
that is happening. I propose that we must declare a dispute guided by
section 189 of the Labour Relations Act.
…
SATAWU
is not in position to interdict the integration process as that case
is not winnable
. We shall
oppose every step of the way belief from the employer that suggests
that for the integration to be successful only former
Arivians must
bear the b[ru]nt. We shall have to advance that argument in front of
the judge at Labour Court.’ (Emphasis
added)
[12]
Mr
Lubabalo conceded in cross examination that SATAWU had been part of
the integration discussions and it remained recognised as
a
collective bargaining party up until 31 May 2011. Even though he had
promised SATAWU members that their retrenchment would be
challenged,
that never happened. He still maintained that interdicting the
integration process had no prospects of success.
Section
189A
[13]
Section
189A provides:
‘
(1)
This section applies to employers employing more than 50 employees if
–
(a)
the employer contemplates
dismissing by reason of the employer’s operational
requirements, at least –
(i)
10 employees, if the employer
employs up to 200 employees;
(ii)
20 employees, if the employer
employs more than 200, but not more than 300, employees;
(iii)
30 employees, if the employer
employs more than 300, but not more than 400, employees;
(iv)
40 employees, if the employer
employs more than 400, but not more than 500, employees; or
(v)
50 employees, if the employer
employs more than 500 employees; or
(b)
the number of employees that
the employer contemplates dismissing together with the number of
employees that have been dismissed
by reason of the employer’s
operational requirements in the 12 months prior to the employer
issuing a notice in terms of
section 189(3), is equal to or exceeds
the relevant number specified in paragraph (a).
…
(13)
If an employer does not comply with a fair procedure, a consulting
party may approach the Labour Court by way of an application
for an
order –
(a)
compelling the employer to comply with a fair procedure;
(b)
interdicting or restraining the employer from dismissing an employee
prior to complying with a fair procedure;
(c)
directing the employer to reinstate an employee until it has complied
with a fair procedure;
(d)
make an award of compensation, if an order in terms of paragraphs (a)
to (c) is not appropriate.
…
(18)
The Labour Court may not adjudicate a dispute about the procedural
fairness of a dismissal based on the employer’s operational
requirements in any dispute referred to it in terms of section
191(5)(b)(ii).’
[14]
It is not
in dispute that TSSA anticipated to retrench 50 employees in an
employ of 2002 workforce after the merger. Therefore,
section 189A is
applicable and the procedural challenge ought to have been dealt with
in accordance with section 189A(13). Clearly,
SATAWU was ill-advised
in its view that it had no prospects of successfully interdicting the
integration process.
[15]
TSSA
correctly submitted that in terms of section 189A(18), this Court
lacks jurisdiction to deal with the procedural fairness.
Substantive
fairness
[16]
As
mentioned above, SATAWU did not challenge the integration process
which sought to deal with the duplication of structures and
facilities consequent to the merger between Arivia and TSSA. In my
view that is the major handle for Ms Gare
as
the decision to retrench need not be the best but must be genuine and
not merely a sham. In
SA
Clothing and Textile Workers Union and Others v Discreto - A Division
of Trump and Springbok Holdings,
[2]
referred
to by TSSA, the Labour Appeal Court (
LAC)
held as follows:
‘
For
the employee fairness is found in the requirement of consultation
prior to a final decision on retrenchment. This requirement
is
essentially a formal or procedural one, but, as is the case in most
requirements of this nature, it has a substantive purpose.
That
purpose is to ensure that the ultimate decision on retrenchment is
properly and genuinely justifiable by operational requirements
or,
put another way, by a commercial or business rationale. The function
of a court in scrutinising the consultation process is
not to
second-guess the commercial or business efficacy of the employer’s
ultimate decision (an issue on which it is, generally,
not qualified
to pronounce upon), but to pass judgment on whether the ultimate
decision arrived at was genuine and not merely a
sham (the kind of
issue which courts are called upon to do in different settings, every
day). The manner in which the court adjudges
the latter issue is to
enquire whether the legal requirements for a proper consultation
process has been followed and, if so, whether
the ultimate decision
arrived at by the employer is operationally and commercially
justifiable on rational grounds, having regard
to what emerged from
the consultation process
.’
(Emphasis added)
[17]
TSSA
consulted with its employees and in particular, SATAWU as a
recognised trade union, about its intention to align the amalgamated
structure on the basis of its International Business Operating Model.
In fact, Mr Wilson testified that TSSA had a bilateral meeting
with
SATAWU where the whole integration process was explained. This
evidence was not disputed.
[18]
Clearly,
what emerged from the consultation meetings with SATAWU was that the
decision
to embark on the integration process
was
operationally and commercially justifiable on rational grounds; hence
it was never challenged.
[19]
Also, Ms
Gare asserts that she had been confronted with a
fait
accompli,
defined
as ‘when an employer takes unilateral action which forecloses
the prospect of meaningful consultation on one or more
of the issues
in respect of which it ought to consult’.
[3]
In my view, a
fait
accompli
challenge is unsustainable in the contexts of a section 189A
retrenchment. Instead of waiting for the process to conclude and cry
foul later, section 189A(13) provides a swift remedy for any
procedural indiscretions during the consultation and before the
retrenchment
is effected.
[20]
With regard
to the selection criteria, Ms Gare is challenging the objectivity
thereof. She testified that LIFO should have been
applied and her
colleague, Mr Codowell, ought to have been selected as he had less
years of service. Mr Wilson, on the other hand,
testified that TSSA
applied excellent fit criteria which entailed appointing the most
suitable candidate for the position. Ms Gare
and Mr Codowell were
interviewed for the position of DB2 Database Administrator. Mr
Codowell was successful because he was found
to be the best fit for
the position. On 22 September 2010, Ms Gare was transferred to the
Career Centre since her position was
redundant.
[21]
SATAWU and
Ms Gare did not challenge the outcome of Ms Gare’s interview
and/or her non-placement. Mr Wilson testified that
in the
consultation meeting that was held on 9 March 2010, with SATAWU
represented by Ms Zodwa Dlamini, a presentation of the Dispute
Resolution Process Relating to Integration was tabled for discussion.
In terms of the process, an employee aggrieved by the matching
process had to lodge a formal grievance within 3 days after the
decision that led to the grievance. The period was extended to
7 days
after the consultation meeting of 9 March 2010, at the instance of
organised labour, including SATAWU.
[22]
In the
recent decision of the LAC in
South
African Breweries (Pty) Ltd v
Louw,
[4]
confronted
with a similar impugn, the following was stated:
[21] In this
matter, what has been inappropriately labelled as the “selection
criteria” is the inclusion of past performance
ratings in the
assessment process for the competitive process to select an incumbent
for the new job of area manager, George. This
is not a method to
select who, from the ranks of the occupants of potentially redundant
posts, is to be dismissed and is not what
section 189(2)(b) is
concerned to regulate. The fact, as illustrated in this matter, that
a dislocated employee, who applies for
a new post and fails, and by
reason thereof remains at risk of dismissal if other opportunities do
not exist does not convert the
assessment criteria for competition
for that post into selection criteria for dismissal, notwithstanding
that broadly speaking
it is possible to perceive the assessment
process for the new post as part of a long, logical, causal chain
ultimately ending in
a dismissal. Accordingly, in our view, it is
contrived to allege that the taking into account of performance
ratings in a process
of recruitment for a post is the utilisation of
an unfair method of selecting for dismissal as contemplated by
sections 189(2)(b)
and 189(7).
[22] An
employer, who seeks to avoid dismissals of a dislocated employee, and
who invites the dislocated employee to compete for
one or more of the
new posts therefore does not act unfairly, still less transgresses
sections 189(2) (b) or 189(7).
The filling of posts after a
restructuring in this manner cannot be faulted. Being required to
compete for such a post is not a
method of selecting for
dismissal
; rather it is a legitimate method of
seeking
to avoid the need to dismiss
a dislocated employee
.
[23]
Intrinsically, a competitive process for appointment makes
assessments of the relative strengths and weaknesses of the
candidates.
What Louw is aggrieved about is that he was uncompetitive
in these assessments. This condition, so he says, derives from unfair
treatment in an earlier, routine performance rating process. It is
not apparent to us that this allegation was substantiated on
the
evidence, but assuming that such a view was plausible, he went into
the interview process well knowing of this circumstance.
It is
common cause he could have invoked standard procedures to have a poor
performance rating re-examined. He failed to exhaust
those remedies
.’
(Emphasis added)
[23]
Even in the
present case, Ms Gare failed to exhaust the internal procedures that
were specifically designed to deal with complaints
in relation to
non-placement. Instead, Ms Gare pursued opportunities for business
partnership with TSSA after her retrenchment
which, unfortunately,
did not yield any fruit. In her evidence, she lamented the TSSA’s
decision to turn down her proposal
for business partnership as she
intended to involve other retrenched employees. It would seem
that Ms Gare had accepted her
fate and was willing to move on as an
entrepreneur.
[24]
TASSA
vehemently disputed Ms Gare’s assertion that the Career Centre
was solely established as a departure lounge so to speak.
Ms Benade
testified that the Career Centre was used for talent management to
reskill and train all impacted employees for placement
in alternative
roles in other parts of the organisation. Employees were assigned to
learn new skills, assisted to apply for positions
and placed. There
were employees who were successfully reintegrated after reskilling.
Ms Gare did not avail herself to the assistance
that was offered at
the Career Centre as she was expecting to be offered a position
without competing for it. Ms Gare on the other
hand testified that
she did apply for other position but was not successful. However,
there was no position offered to her as an
alternative to
retrenchment.
[25]
Ms Gare was
a member of SATAWU and it owed it to her to diligently represent her
during the consultation on the integration process.
All the issues
she is raising in these proceedings go to the core of fairness of the
consultation process. SATAWU is a notable
trade union with vast
experience in labour legislation. Clearly, they dropped the ball by
failing to challenge the procedural fairness
of the consultation
process in terms of section 189A(13).
Conclusion
[26]
In all the
circumstances, I am satisfied that the retrenchment of Ms Gare was
substantively fair.
Costs
[27]
The only
issue remaining is that of costs. SATAWU is not cited as party in
these proceedings and it does not look like they are
funding this
litigation. In any event, it is trite that costs in this Court do not
follow the result and that in making an order
for costs, the Court
must consider the principles of law and fairness. This is a matter
where a cost order will offend the aforementioned
principles,
especially since Ms Gare is an individual litigant.
[28]
In the
circumstances, I make the following order:
Order
1.
The
dismissal
of
the applicant, Ms Gare is substantively fair.
2.
There is no
order as to costs.
P
Nkutha-Nkontwana
Judge
of the Labour Court of South Africa
Appearances
For
the applicant: Mr JCM
Roets
For
the applicant: Advocate T
Molokomme
Instructed
by:
Moshoana Mabena Mogane
Inc.
[1]
Act 66 of 1995 as amended.
[2]
See:
SACTWU
and Others v Discreto (A Division of Trump and Springbok Holdings)
[1998]
12 BLLR 1228
(LAC) at para 8; see also
BMD
Knitting Mills (Pty) Ltd v SACTWU
[2001]
7 BLLR 705
(LAC) at para 19;
CWIU
and Others v Algrorax (Pty) Ltd
[2003] 11 BLLR 1081
(LAC) at paras 69 – 70
.
[3]
See:
SASBO
v Standard Bank of SA
[2011] JOL 26928
(LC) at para 36.
[4]
[2017] ZALAC 63
;
[2018] 1 BLLR 26
(LAC); (2018) 39 ILJ 189 (LAC) at paras 21-23.