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[2018] ZALCPE 32
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Lebepe v UMSO Construction (Pty) Ltd (PS 29/2014) [2018] ZALCPE 32 (8 November 2018)
IN THE LABOUR COURT OF
SOUTH AFRICA, PORT ELIZABETH
Not Reportable
Case No: PS 29/2014
In
the matter between:
WELLINGTON
LEBEPE
Applicant
and
UMSO
CONSTRUCTION (PTY) LTD
Respondent
Heard:
12-13 September 2018
Delivered:
8 November 2018
JUDGMENT
Lallie.
J
[1]
The respondent conducts business in the construction industry. It has
offices in a number of provinces including Gauteng and
the Eastern
Cape. It benefited from the economic growth in the industry which
resulted from the country’s preparation for
the 2010 world cup.
It also felt the slump which followed and resulted in retrenchment of
a number of employees. The applicant
was employed by the respondent
as a buyer in 2007. He was dismissed at the end of 2012 at a time he
was based at the East London
office of the respondent owing to
operational requirements of the respondent (retrenched). In these
proceedings he seeks relief
for his alleged substantively and
procedurally unfair retrenchment. The matter is opposed by the
respondent on the grounds that
the retrenchment was both
substantively and procedurally fair.
[2]
In its attempts to prove the fairness of the applicant’s
retrenchment the applicant called 2 witnesses. Messrs Komane
(Komane)
and Kasha (Kasha). At the time of the applicant’s retrenchment
Komane was employed as the respondent’s Human
Resources
Director. Substantiating the alleged substantive fairness of the
applicant’s retrenchment he testified that at
the end of 2010
the respondent had a lot of projects and employed over 700 employees,
200 of whom were permanent employees. Toward
the end of 2011 going
forward the respondent had no projects as there was a lack of work in
the market. He testified that employees
were aware that the
respondent was not getting work as tenders and projects were
displayed on notice boards and made available
electronically. It is
the lack of business which resulted in the economic position that
necessitated the retrenchment of employees
including the applicant.
[3]
Section 213 of the Labour Relations Act
[1]
(the
LRA) includes economic requirements in its definition of operational
requirements. Under cross-examination the applicant conceded
that as
a buyer he was busy in 2008. He was even busier and the respondent
extremely busy in 2009 as they were preparing for the
2010 world cup.
He acknowledged that the jobs they were busy with would be displayed
on the notice board. He further conceded that
in 2011 there was a
significant decline in work and in 2012 there was not even a notice
board displaying work that had to be done.
All the concessions made
by the applicant give credence to the respondent’s version that
its economic position in 2012 justified
retrenchment. I therefore
accept that the respondent discharged the onus of proving the
substantive fairness of the applicant’s
retrenchment.
[4]
The applicant challenged the procedural fairness of his retrenchment
on the grounds that his retrenchment was not preceded by
a meaningful
consultation. Although the respondent called Kasha to corroborate
Komane’s evidence, he did not help much as
he was unable to
remember a lot of material facts. Procedural fairness of
retrenchments is governed by section 189 of the LRA.
Section 189
(1)(d) requires an employer contemplating retrenching an employee or
employees to consult employees likely to be affected
by the proposed
retrenchment. Section 189(2) requires the consulting parties to
engage in a meaningful joint consensus-seeking
process and attempt to
reach consensus on a number of issues which include measures to avoid
and minimize dismissal, change in
its timing and mitigation of its
adverse effects. The consultation must be preceded, in terms of
section 189(3), by the issuing
of a written notice by the employer to
the consulting party disclosing relevant issues. The issues include
the following:
‘
(a)
the reasons for the proposed dismissals;
(b)
the alternatives that
the employer considered before proposing the dismissals, and the
reasons for rejecting each of those alternatives;
(c)
the number of employees
likely to be affected and the job categories in which they are
employed;
(d)
the proposed method for
selecting which employees to dismiss;
(e)
the time when, or the
period during which, the dismissals are likely to take effect;
(f)
the severance pay
proposed;
(g)
any assistance that the
employer proposes to offer to the employees likely to be dismissed;
(h)
the possibility of the
future re-employment of the employees who are dismissed;
(i)
the number of employees
employed by the employer; and
(j)
the number of employees
that the employer has dismissed for reasons based on its operational
requirements in the preceding 12 months.’
[5]
I reject the arguments on behalf of the respondent that it proved
that the applicant’s retrenchment was preceded by a
fair
procedure as envisaged in section 189 of the LRA. That argument is
not supported by evidence. Komane conceded that the respondent
did
not issue a notice in terms of section 189(3) of the LRA. It is
common cause that on 29 October 2012 the respondent’s
managing
director called a staff meeting in which the applicant was present
and informed staff of the difficult financial position
the respondent
was in. He further told them that if things did not change the
respondent would be forced to retrench. Komane testified
that he told
staff members to convey their ideas to their manager. Staff members
were given an opportunity to ask questions but
no one posed any. A
second meeting was held on 29 November 2012 in which staff was told
that the respondent’s financial position
had not changed as a
result employees would be retrenched. In the afternoon of the same
day Komane and Spamla (Spamla) had a one
on one meeting with the
applicant and informed him that he had been selected for
retrenchment. He was shocked and asked for reasons
for his selection.
They told him that Spamla was going to add the applicant’s
duties to his. On 30 November 2012 the applicant
was given his
retrenchment letter and offered transport for his belongings to his
home in Gauteng at the respondent’s cost.
[5]
Komane’s evidence proved the respondent’s failure to
follow a fair procedure when retrenching the applicant. The
consequences of the applicant’s failure to issue the written
notice in terms of section 189(3) are that the applicant was
not
given relevant information before attending the meeting of 29 October
2012. Komane conceded that employees were told of the
meeting on the
morning of 29 October 2012 and its purpose was not disclosed. They
were therefore not prepared for the meeting.
The respondent cannot
seek to use the employees’ failure to ask questions at that
meeting to its advantage. The employees
including the applicant were
not prepared. All the issues they were supposed to consult about
should have been included in the
notice the respondent failed to
provide. The meeting of 29 October 2012 does not constitute
consultation as envisaged in section
189(2) of the LRA. In the
absence of compliance with section 189(3) the quality of the intended
consultation was compromised.
The applicant was denied of the
opportunity to influence the respondent to protect his job including
avoiding his selection for
retrenchment.
[6]
Komane testified that the applicant was shocked when they told him
that he had been selected for retrenchment. The retrenchment
procedure in section 189 is designed to protect employees from being
surprised by the news of their retrenchments. The respondent’s
attempts to rely on the meeting on 29 November 2012 to substantiate
its submission that it followed a fair procedure and consulted
with
the applicant cannot succeed. By Komane’s own admission, the
decision to retrench the applicant had already been taken.
The real
reason for the meeting was to convey the decision that he had been
retrenched. The applicant’s dismissal was procedurally
unfair.
[7]
The applicant sought 12 months compensation as relief for his unfair
retrenchment. As his retrenchment was only procedurally
unfair the
appropriate relief is compensation. The amount of compensation which
is just and equitable in all the circumstances
for the solatium of
the procedurally unfair retrenchment is R122 000.00 which is
equivalent to remuneration the applicant would
have earned over a
period of 8 months calculated at the applicant’s rate of
remuneration on the date of his dismissal. The
applicant sought a
costs order against the respondent. Both the law and fairness justify
the grant of the order as the applicant
should not be out of pocket
for asserting his right to fair procedure which was flagrantly
violated by the respondent.
[8]
The applicant also sought an order for the costs reserved on 12
September 2014 which were occasioned by the postponement of
the trial
at the instance of the respondent. The respondent sought to launch a
rescission application which was refused,
inter alia
, because
it was ill-conceived. As the applicant incurred costs as a result of
the postponement which the respondent sought very
late, fairness
justifies that the respondent take responsibility for the costs.
[9]
In the premises, the following order is made:
Order
1.
The
Applicant’s dismissal for operational requirements of the
respondent was substantively fair but procedurally unfair.
2.
The
respondent is ordered to pay the applicant compensation in the amount
of R122 000.00 .The respondent is ordered to pay the applicant’s
costs such costs include the costs reserved on 12 September 2014.
Z
Lallie
Judge
of the Labour Court of South Africa
Appearances
For
the Applicant:
Mr Sehunane of Sehunane Attorneys
For
the Respondent:
Advocate Ellis
Instructed
by
Boqwana Burns Inc
[1]
66
of 1995