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[2019] ZALCJHB 170
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National Educational Health and Allied Workers obo Makhibedu v Public Health and Social Development Sectoral Bargaining Council and Others (JR166/2017) [2019] ZALCJHB 170 (19 July 2019)
In
the labour court of South Africa, Johannesburg
Not
Reportable
Case no: JR 166/2017
In the matter between:
NATIONAL EDUCATIONAL
HEALTH AND
ALLIED WORKERS obo
VICTOR SIPHO
MAKHUBEDU
(‘NEHAWU’) Applicant
And
PUBLIC HEALTH AND
SOCIAL DEVELOPMENT
SECTORAL
BARGAINING COUNCIL
First Respondent
PANELIST,
MR THANDO NDLEBE
N.O
Second Respondent
DEPARTMENT OF HEALTH
MPUMALANGA
PROVICE
Third
Respondent
Heard: 11 July 2019
Delivered:
19 July 2019
JUDGMENT
OLIVIER
AJ
Introduction
[1]
This is an application to review and set
aside the arbitration award made by the Second Respondent, with case
number PSH337-16/17
under the auspices of the First Respondent.
Background facts
[2]
The Applicant argues that he was unfairly
and unlawfully dismissed by the Third Respondent on 22 June 2016.
The charges that
led to his dismissal were that the Applicant failed
to avoid irregular and/or unauthorised and/or fruitless and wasteful
expenditure
in relation to the appointment of three ward clerks and
three Telkom operators at Evander Hospital (Reference number
MPDOH-Local
July 13/007 and MPDOH-Local July 113/008) whilst there
was a moratorium in place on new appointments during 2014.
The Review grounds
[3]
Central to the case of the Applicant is his
allegation that the Second Respondent grossly misdirected himself on
the reason for
the dismissal in that the Chairperson of the
disciplinary hearing dismissed him for appointing the three ward
clerks and three
Telkom operators. The Applicant argues that
there is no conclusive evidence that he ever appointed any new
employee at the
Evander Hospital.
[4]
In addition he argues that there was no
proper evidence in relation to the rule that he has allegedly
breached. In addition the
Applicant submits that the Second
Respondent grossly misdirected himself on the evidence properly put
before him relating to the
seriousness or gravity of the charges and
in particularly whether a finding of guilt on such charges breaches
the trust relationship.
[5]
Finally, the Applicant also argues that the
Second Respondent acted inconsistently in that other employees who
were also charged
in respect of the same charges, namely Mr. Sithole
and Dr. Mhlongo were re-instated despite the fact that they were
found guilty
on the same charges.
[6]
The Applicant also argued that two further
employees, Mrs. Hlatshwayo and Mrs. Jiyane should also have been
charged and dismissed.
As such the Applicant argues that the
Second Respondent committed a gross irregularly by misdirecting
himself on the legal concept
relating to consistency.
The review test
[7]
In
Sidumo
and another vs Rustenburg Platinum Mines Limited
and others ("Sidumo"), the Constitutional Court held that :
"in the light of the
constitutional requirement (in section 33(1) of the Constitution)
that everyone has the right to administrative
action that is lawful,
reasonable and procedurally fair, the reasonableness standard should
now suffuse s145 of the LRA"
"the threshold test
for the reasonableness of an award or ruling is the following:
is the decision reached
by the commissioner one that a reasonable decision-maker could not
reach"
[8]
Following
on Sidumo the Supreme Court of Appeal in the Judgment of
Herholdt
vs Nedbank
("Herholdt")
[1]
held
as follows:
"A review of a CCMA
award is permissible if the defect in the proceedings falls within
one of the grounds in s145(2)(a) of
the LRA. For a defect in
the conduct of the proceedings to amount to a gross irregularity as
contemplated by s145(2)(a)(ii),
the arbitrator must have misconceived
the nature of the inquiry or arrived at an unreasonable result.
A result will only
be unreasonable if it is one that a reasonable
arbitrator could not reach on all the material that was before the
arbitrator.
Material errors of fact, as well as the weight and
relevance to be attached to particular facts, are not in and of
themselves sufficient
for an award to be set aside, but are only of
any consequence if their effect is to render the outcome
unreasonable."
(emphasis added).
Following
the Herholdt and Gold Fields judgments the Labour Appeal Court handed
down the judgment of Mofokeng
[2]
.
In this judgment, Murphy AJA, writing for the unanimous Court,
provided the following exposition of the review test:
"[32] Mere errors of
fact or law may not be enough to vitiate the award. Something more is
required. 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 enquiry,
undertaken the enquiry in the wrong
manner or arrived at an unreasonable result. Lapses in lawfulness,
latent or patent irregularities
and instances of dialectical
unreasonableness should be of such an order (singularly or
cumulatively) as to result in a misconceived
enquiry or a decision
which no reasonable decision maker could reach on all the material
that was before him or her.
[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 enquiry.
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 enquiry,
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 hypothesis
be material to the determination of the dispute. A material error of
this order would point to at least a
prima
facie
unreasonable result. The
reviewing judge must then have regard to the general nature of the
decision in issue; the range of relevant
factors informing the
decision; the nature of the competing interests impacted upon by the
decision; and then ask whether a reasonable
equilibrium has been
struck in accordance with the objects of the LRA. Provided the right
question was asked and answered by the
arbitrator, a wrong answer
will not necessarily be unreasonable. By the same token, an
irregularity or error material to the determination
of the dispute
may constitute a misconception of the nature of
the
enquiry so as to lead to no fair trial of the issues, with the result
that the award may be set aside on that ground alone.
The arbitrator
however must be shown to have diverted from the correct path in the
conduct of the arbitration and as a result failed
to address the question raised for determination."
[9]
The dictum in Mofokeng says many important
things about the review test. The dictum provides for the following
analysis:
9.1
the first enquiry is whether the facts
ignored were material, which will be the case if a consideration of
them would (on the probabilities)
have caused the commissioner to
come to a different result;
9.2
if this is established, the (objectively
wrong) result arrived at by the commissioner is prima facie
unreasonable;
9.3
a second enquiry must then be embarked upon
— it being whether there exists a basis in the evidence overall
to displace the
prima facie case of unreasonableness; and
9.4
if the answer to this enquiry is in the
negative, then the award stands to be set aside on review on the
grounds of unreasonableness
(and vice versa).
The Commissioner's
findings
[10]
Should one have regard to the material
findings made by the Second Respondent, a summary of which can be
found in paragraph 47 of
the arbitration award, it is clear that the
Panellist carefully considered and analysed the evidence of Mr.
Boikanyo, an independent
witness who prepared a forensic report
relating to the appointment of three ward clerks and three Telkom
operators at the Evander
hospital. It is common cause that the
Applicant was appointed to the position of Deputy Director General:
Finance of
the Department of Health of the Mpumalanga Province.
He conceded that he occupied a very senior position.
[11]
The Commissioner was confronted with the
common cause fact that only two (2) ward clerk posts and two (2)
Telkom operator posts
were advertised on 9 July 2013. In
addition, Circular 28 of 2013 of the Department of Health dated 30
September 2013 placed
a moratorium on the filling of positions due to
the dire financial situation that persisted in the Province at the
time.
Managers were in particular directed to the following
directive in Circular 29 of 2013 and dated 4 October 2013:
11.1
All post are frozen with immediate effect;
11.2
All Managers are directed to ensure that
there is no over spend on the
budget; and
11.3
Disciplinary action will be taken against
Managers who violate this rule.
[12]
In addition the Commissioner was also
referred to the relevant provisions of the Public Finance Management
Act ("PFMA").
The Applicant clearly stated during his
examination in chief that he had knowledge of the PFMA and understood
that his role as
Deputy Director General: Finance or Chief
Financial Officer involved taking responsibility for the finances of
the Third
Respondent.
[13]
The PFMA defines "irregular
expenditure" as expenditure other than unauthorised expenditure,
incurred in contravention
of or that is not in accordance with the
requirement of any applicable legislation. Section 45
furthermore places an obligation
on the Chief Financial Officer,
amongst others, to ensure that the system of financial management and
the internal control established
for that Department is carried out
within the area of responsibility of that official and that the
Department's resources are used
in an effective, efficient and
economical manner.
[14]
Furthermore, it could also not be disputed
by the Applicant that as the Chief Financial Officer he was
responsible in terms of Section
45 of the PFMA to take appropriate
steps to prevent, within his area of responsibility, any unauthorised
expenditure or fruitless
and wasteful expenditure and to safeguard
the assets of the Province.
[15]
The Applicant testified that he was aware
of the moratorium that was placed in respect of the filling of
positions and the issuing
of appointment letters during the 2013/2014
Financial Year
.
He
however argued that although the positions in dispute were advertised
during the 2013/2014 year, the appointments only became
effective in
the next Financial Year. He further argued that he merely
recommended the appointments and that it was in fact
the MEC who
appointed the persons to the positions. He denies that he
transgressed any provision of the PFMA.
[16]
The Applicant further argued that the Third
Respondent acted in an inconsistent manner by not disciplining Mrs.
Hlatshwayo or Mr.
Sithole who recommended the appointments in the
first place.
[17]
The Third Respondent's main argument was
that the Applicant's position as Chief Financial Officer placed on
him a duty to take appropriate
steps to prevent irregular expenditure
and effectively manage the finances of his employer. Due to the
fact that the Applicant
had admitted that the appointments had taken
place based on the recommendations he made during the 2013/2014
Financial Year, it
argued that the Applicant actively decided to
recommend the appointments whilst knowing that the recruitment
process was in contravention
of the moratorium and the decision to
freeze all post.
[18]
The Applicant also admitted that he signed
the memorandums supporting the appointments on 24 February 2013 full
knowing that only
two (2) positions for ward clerk and two (2)
positions for Telkom operators were advertised. The memorandum
that he supported
however recommended the appointment of three (3)
ward clerks and three (3) Telkom operators, therefore one additional
position
each. The Applicant presented no evidence that the
additional positions were budgeted for or that there were sufficient
funds
to pay the salaries of the additional appointees. In fact
he agreed that it was a general practise in the Department to appoint
more persons than the number of positions which were advertised.
[19]
In paragraph 49 of the award the Second
Respondent concludes that the Applicant was very much aware of the
rules in respect of appointing
persons in positions in respect of
which there was a moratorium on appointments. Despite such
knowledge, the Applicant still
proceeded to recommend the
appointments in the 2013/2014 Financial Year. As the Chief
Financial Officer he was indeed the
custodian of the finances of the
Respondent and he should have known that his recommendation for the
appointments would lead to
additional persons being appointed with
the obvious consequence that additional expenditure would be needed
to fund such appointments.
[20]
The Second Respondent accordingly concluded
that the appointments of the additional ward clerk and Telkom
operator were irregular
and in contravention of the PFMA and that the
Applicant breached his obligations to safeguard the Third Respondent
from such irregular
expenditure.
Did the Commissioner
misconceive the nature of the enquiry and his duties in connection
with it?
[21]
Having regard to the findings of the Second
Respondent and the evidence presented by both Mr. Boikanyo and the
Applicant the Court
has formed the view that the Second Respondent
properly considered all the relevant and material facts before him
and that it is
not the case that a reasonable Commissioner could have
come to a different result.
[22]
The Second Respondent asked all the correct
questions in relation to the obligations placed on the Applicant as
Chief Financial
Officer by virtue of the provisions of Section 45 of
the PFMA. He also properly considered whether the Applicant was
able
to prove that there was indeed a budget for the additional
positions and whether in fact such positions were on the priority
list.
No such evidence was led by the Applicant and he
persisted with a consistent denial that he had not breached the
provisions of
the PFMA.
[23]
There was also no specific evidence placed
before the Commissioner as to why Mrs. Hlatshwayo and Ms. Jiyane
should have been disciplined
or found guilty by the Department.
In respect of the matters of Mr. Sithole and Dr. Mhlongo, the
Applicant did not place
sufficient evidence before the Second
Respondent in order for him to consider particularly whether there
was inconsistent application
of discipline by the Third Respondent.
[24]
The Court also finds that in respect of the
matter of Dr. Mhlongo where the Second Respondent had also presided
over arbitration
proceedings relating to 3his dismissal, that there
were not sufficient facts or circumstances placed before this court
in order
to consider whether there was inconsistent treatment of the
different parties. This Court was not seized with the matter of
Dr. Mhlongo to consider all relevant facts and circumstances and
therefore cannot be expected to express a view on the allegations
of
inconsistency placed before it by the representative for the
Applicant. Such comparison would have required that the full
record of the Mhlongo matter should also have been placed before the
Court. This did not occur.
[25]
In the circumstances the Court finds that
the Second Respondent properly considered the evidence placed before
him, considered relevant
material facts and circumstances and arrived
at a conclusion that is justifiable and reasonable in relation to the
evidence placed
before him.
[26]
The Court is of the view that the Second
Respondent had indeed pursued the correct enquiry, he considered
relevant material before
him and the result he arrived at is one that
a reasonable decision maker could have reached. In addition the
full conspectus
of facts and the breach by the Applicant on the
duties placed on him as custodian of finances of the Third Respondent
are of itself
sufficient evidence of a breakdown of the trust
relationship, warranting dismissal. The Second Respondent's
conclusion in
this regard was accordingly also reasonable.
[27]
In the premises, I make the following
order:
Order
The application is
dismissed.
There
is no order as to costs.
____________________
G. J. P. OLIVIER
Acting Judge of the
Labour Court of South Africa
Appearances:
For the Applicant: M.J
Ponoane of Ponoane Attorneys
For the Respondents: Adv.
Ferdi Venter
Instructed
by: Adendorff Theron Inc.
[1]
[2013]
11 BLLR 1074 (SCA)
[2]
Head
of Department Education v Mofokeng and Others
[2015] 1 BLLR 50
LAC