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[2019] ZALCJHB 259
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Marais v Aveng Grinaker Lta (JS602/14) [2019] ZALCJHB 259 (10 September 2019)
THE
LABOUR COURT OF SOUTH AFRICA, JOHANNESBURG
Not Reportable
case
no:
JS
602/14
In
the matter between:
JOHN
JACOBUS MARAIS
Applicant
and
AVENG
GRINAKER
LTA
Respondent
Heard
:
05 September 2019
Delivered
:
10 September 2019
Summary:
Dismissal based on age – presumed to be an unfair
discrimination unless – shown that the age is one agreed
upon
for retirement or a normal retirement one. Where an employee
continues to render services beyond the retirement age –
dismissal after that on the basis of age not automatically unfair –
unless some new employment agreement is shown to exist
without an
agreed retirement age. No new agreement shown to exist to enable the
applicant to claim automatically unfair dismissal.
Held: (1) The
applicant has not been automatically unfairly dismissed. (2) No order
as to costs.
JUDGMENT
MOSHOANA,
J
Introduction
[1]
In this referral, there is no dispute that the applicant’s
employment
was terminated on 14 October 2013 on the basis that he had
reached the age of sixty years. It is also common cause that at the
time of dismissal, the applicant was aged 62 and had worked for two
years past the normal retirement age of sixty years. The applicant
was aggrieved by his dismissal and referred a dispute alleging
automatically unfair dismissal. In justifying the dismissal, the
respondent alleged that the applicant had reached the normal
retirement age, thus his dismissal is not unfair. In this judgment,
given the undisputed fact that sixty years is a normal retirement
age, it is unnecessary to traverse all the evidence received
by this
Court.
Background
facts and evidence.
[2]
The applicant commenced employment in July 1985. Over the years, the
company that employed
him merged with another entity to form the
respondent before me. In the year 2011, the applicant turned sixty.
In the nature of
his job, the applicant was more of a globe-trotter.
The respondent contended that his continuation to serve it beyond the
age of
sixty was occasioned by what was referred in evidence as a
“
slip through the cracks
”. Around October 2013,
the applicant together with three of his fellow employees were
approached by Mr Randa, the then Human
Resources Manager to inform
them that owing to their age, their services were no longer required.
The applicant was displeased
thereby and vouched to obtain legal
advice on the issue.
[3]
On 14 October 2013, the applicant was furnished with an employment
certificate, certifying
that he was an employee of the respondent
from 01 July 1985 – 31 October 2013. The applicant was
aggrieved and proceeded
to seek legal advice as vouched when the news
was first broken to him and his fellow employees. Such culminated in
him referring
a dispute to this Court for adjudication on or about
August 2014. The referral is opposed by the respondent.
[4]
Following a
pre-trial conference, the parties produced an agreement. It became
common cause that the normal retirement age in terms
of the rules of
the respondent’s retirement plan is 60 years and that the
compulsory retirement age prescribed by the respondent’s
Employee Benefits Administration Manual (EBAM) is 60 years
[1]
.
[5]
In support
of his case of alleged automatically unfair dismissal, the applicant
testified. He presented a case that sought to contradict
the admitted
fact of sixty years being the normal retirement age. He testified
that since 1985, he knew that his retirement age
was set at 65 years
and such has never changed ever since. His knowledge was that, like
in government, the retirement age for women
was 60 years and for men
was 65 years
[2]
. Thus, at the
time when he was retired – dismissed due to age, he had not
reached the “agreed” retirement age
of 65 years. In
addition, he testified that since he worked beyond the normal
retirement age, his dismissal two years later is
automatically
unfair. He was promised that for as long as there was work to be
performed, which there was at the time he was retired,
he shall
remain in employment.
[6]
In rebuttal, the respondent led the evidence of three witnesses,
namely; Mr Richard Derwort;
Mr De Grits and Mr Fred Randa. All the
witnesses other than Mr Randa presented testimony seeking to prove a
common cause fact.
Derwort testified that the norm in the
construction industry is to retire at the age of 60. Mr De Grits
testified that originally,
the retirement age was set at 62 years.
When Grinaker merged with LTA to form the respondent, the age was
reduced from 62 to 60.
Since 2001, the position, which was well
communicated, remained that 60 years was the retirement age and he
also retired at that
age.
[7]
Mr Randa is the one who discovered that a number of employees were
working beyond their
retirement age, which was something that slipped
through the cracks. At the time when the respondent was undergoing a
restructuring
process, it was decided that in order to reduce
headcount, the issue that slipped through the cracks ought to be
revisited. He
embarked on a road show process, at which encounter, he
discussed with the applicant and his colleagues that they are to be
retired.
Indeed, on 14 October 2013, he signed a certificate of
service for the applicant.
Evaluation
and discussion.
[8]
An employee
who has been dismissed would either know the reason why he or she has
been dismissed or not know the reason. The Labour
Relations Act
[3]
(LRA) is designed in such a way that a dismissed employee chooses a
forum and the nature or form of the dismissal. If an employee
does
know the reason, an employee may fashion his or her dismissal as an
automatically unfair one or an ordinary unfair dismissal.
In terms of
section 191 (5) of the LRA, if an employee does not know the reason
of his or her dismissal, he or she must refer the
dismissal dispute
to the Bargaining Council or the Commission for arbitration.
[9]
However, if an employee alleges that the reason for dismissal is
automatically unfair, as
is the case herein, the employee may refer
the dispute to this Court for adjudication. In terms of section 187
(1) (f) of the LRA,
a dismissal is automatically unfair if the reason
for the dismissal is that the employer unfairly discriminated an
employee on
the basis of age. The applicant before me chose to peg
his case as one of automatically unfair dismissal.
[10]
May I point out at this juncture that if the evidence of Randa is
carefully analysed, the dismissal of the
applicant may have been for
operational requirements masqueraded as one based on age.
Unfortunately, this is not the case presented
for adjudication. It
has been held by this Court and the Labour Appeal Court that it is
one of the duties of this Court to establish
the true reason for the
dismissal. However, this Court can only ride that horse –
determining the true reason – when
parties are in dispute about
it. In
casu
, it remains undisputed that the applicant was
dismissed for reasons related to his age.
[11]
Presumably, dismissing an employee on the basis of age amounts to
unfair discrimination. But, that presumption
is rebuttable once the
provisions of section 187 (2) are met. The section provides thus:
“
(2)
Despite subsection (1) (f)-
(a) …
(b) a dismissal
based on age is fair if the employee
has reached the normal or
agreed retirement age
for persons employed in that capacity.”
[12]
In
casu
,
it is fact that sixty years is a normal retirement age. It is
undisputed that the applicant in 2011 reached the normal retirement
age. On application of the principle enshrined in
Schweitzer
v Waco Distributors (a division of Voltex (Pty) Ltd)
[4]
,
which is (a) was the employee’s dismissal based on age? (b) If
the answer to question (a) is in the affirmative, the next
question
is, did the employee have a normal or agreed retirement age for
persons employed in the capacity in which the employee
was employed?
If yes, what was it, (c) if the answer to the first part of the
question in (b) is in the affirmative, the next question
is; had the
employee reached such retirement age at the time of dismissal? If so,
then the dismissal of the applicant is fair.
As pointed out earlier,
the applicant himself alleged that the reason for his dismissal was
age related. This, the respondent did
not dispute. Also, it is fact
that sixty years was the normal retirement age. Lastly and most
importantly, the applicant had reached
the normal retirement age at
the time of dismissal – 14 October 2013.
[13]
For reasons
that are not convincing to me, the
Waco
decision was heavily criticised, which criticism resonated with my
late brother Steenkamp AJ (as he then was) in
Datt
v Gunnebo Industries (Pty) Ltd
[5]
.
I fail
to grasp the width and the depth of this criticism. The LRA is
premised on the concept of fairness. The fairness contemplated
in the
Act is not to be one-sided. It must be fairness to both the employer
and the employee. The section provides a defence to
the claim of
presumed unfair discrimination. This defence does not dissipate or
morph into something else. Once it presents itself,
it shall remain
intact and available for the employer irrespective of when it is
unleashed. I shall return to this point later.
Despite the sharp
criticism, the decision was never overruled. In fact it was quoted
with approval in the subsequent judgments
of this Court
[6]
.
[14]
I venture
to say that the principle in
Waco
was accepted by the Labour Appeal Court (LAC) in its judgment of
Ivor
Michael Karan t/a Karan Beef Feedlot v J W C Randall
[7]
.
The LAC
per Tlaletsi JA held thus:
“
[19]
There are two plausible arguments concerning the application of
section 187(1) (f) and 187(2) (b) in
this matter. The first is that
where there is a normal or agreed retirement age and the employee has
reached that age, the employer
shall
enjoy protection in section
187(2)(b) from that and at any time thereafter.
He or she would
be
entitled to terminate
the employment of the employee on the
grounds of age.
[20]
The second scenario is that, where there is an agreement reached
between the employer and the
employee
before the latter has
reached the normal or agreed retirement age
, to determine a new
retirement age, the employer would enjoy the protection of section
187(2) (b), should he/she terminate the
employment of the employee,
once the new agreed date is reached.”
[15]
Clearly,
once the day of reckoning arrives – reaching the normal or
agreed retirement age – the clock cannot be reversed.
The only
way to reverse it is to novate
[8]
.
In the nature of novation, the obligation must still be extant at the
time of replacement. In my view, once the horse bolts –
the
retirement age is reached – the retirement age is not capable
of being novated. I understand this to be the point made
by the LAC
in
Karan
Beef supra
.
Was
there novation in this matter?
[16]
An argument was presented before me that the fact that the applicant
worked beyond the normal retirement
age, suggests that the applicant
cannot be dismissed on the ground of age. In support of the argument,
reliance was placed on
Datt supra
. I must state upfront that
Datt
is distinguishable. In
casu,
there were no
discussions before or even after the passing of the retirement date.
In
Datt
, two months after the retirement age, a letter was
sent to Datt asking him to stay on until a date to be mutually agreed
upon.
[17]
Novation is
a matter of intention and
consensus
[9]
.
When the parties novate, they intend to replace a valid contract by
another valid contract
[10]
.
Therefore, once an employee reaches a normal or agreed retirement
age, there is no longer a valid and enforceable employment
agreement
[11]
. Perhaps what
may come into being is another employment contract, where an employee
continues after an employment agreement becomes
invalid. However,
like any other agreement all the formalities must be present in order
to be a valid one. One of the formalities
is that there must be a
meeting of minds. There must be an offer followed by acceptance.
Assuming that when the applicant continued
after 2011, he offered his
services again. Fact is the respondent did not accept that offer.
Silence cannot be acceptance. Quiescence
is not necessarily
acquiescence and one party cannot, without the assent of the other,
impose upon such other a condition to that
effect.
[12]
Clearly, in this matter after 2011, there was no meeting of minds –
having slipped through the cracks, as testified, it cannot
be said
that the respondent was consciously aware that the applicant
continued and/or made an offer of his services again. Negligence
does
not equate intention or consensus. Accordingly, there can never be an
agreement to be re-employed in this matter.
[18]
On another
level, I part ways with
Datt
,
to the extent that it suggests that the employment agreement was
novated
[13]
by the letter of
June 2014. At that time, there was no longer a valid employment
agreement, it having lapsed in April 2014 when
Datt reached the
agreed retirement age of 65 years. I take a view that once the age is
reached, the contractual obligation is discharged.
However, this does
not, to my mind, suggest that an employer may not re-hire, as it
were, an employee who had reached a normal
or agreed retirement age.
Therefore, for me what happened in
Datt
is more a re-hire than novation. In such a situation, which situation
does not obtain in the matter before me, when an employer
terminates
the employment of a re-hired employee on the basis of age and it is
established that the age at which he or she is terminated
is not a
normal retirement one or an agreed one, the dismissal that ensues
would be automatically unfair. On the evidence before
me, the
applicant, without any other agreement continued to work. The
respondent refers to that as a slip through the cracks.
[19]
I therefore conclude that I am respectfully unable to follow
Datt
for reasons set out above. A comment in passing is that, in my
view, Mr Datt had reached the agreed retirement age and as such, the
defence should have been available to Gunnebo Industries. Therefore,
even if the facts were not distinguishable, I would not have,
respectfully, followed
Datt
. The defence becomes available
once the age reached is a normal retirement one or an agreed one. In
Datt
there was no agreed age as it was still to be mutually
agreed upon. However, that does not detract from the fact that age 65
was
a normal retirement age for persons in the capacity of
Mr
Datt
. It does appear that my late brother was more concerned with
the existence of an agreement as opposed to what was normal.
[20]
Besides,
the LAC in
Karan
Beef
,
rejected a conclusion that an employer is not entitled to
unilaterally determine a retirement date. The Court remarked that
there
was nothing unlawful or unfair in leaving it to an employer to
determine the retirement age or date
[14]
.
Conclusions
and remarks
[21]
For reasons that are clearly apparent in this judgment, I must
conclude that the dismissal of the applicant
is fair. In other words,
the respondent successfully raised the defence set out in section
187(2)(b) of the LRA. I further conclude
that there was no novation
when the applicant continued to work silently beyond the normal
retirement age. On the assumption, which
assumption I am not making
in this matter, that the employment agreement continued beyond the
normal retirement age of sixty the
applicant may have successfully
alleged and proved that the true reason for his dismissal was
operational requirements disguised
as age. However, such a case is
not before me.
[22]
For all the above reasons, the following order is made:
Order
1.
The applicant’s dismissal is fair.
2.
The applicant’s claim for
automatically unfair dismissal is dismissed.
3.
There is no order as to costs.
_______________________
GN Moshoana
Judge
of the Labour Court of South Africa
Appearances:
For
the Applicant
: Mr M Opperman of Waks
Silent Attorneys, Klerksdorp.
For the
Respondent
: Advocate H Nieuwoudt
Instructed
by
: Wilken Inc, Sandton.
[1]
This meant that it was unnecessary at the trial of the dispute to
lead and/or examine evidence on what the normal retirement
age was.
Once an issue becomes common cause no evidence needs to be led to
prove it as such. By being common cause, it becomes
fact. Therefore,
before me, it is a fact that sixty years was the normal retirement
age.
[2]
This was the position pre-democracy. With the advent of the
constitutional order this position changed.
[3]
Act 66 of 1995, as amended.
[4]
[1999] 2 BLLR 188 (LC).
[5]
[2009] 5 BLLR 449 (LC).
[6]
See:
Deon
Bos v EON Consulting
Case JS 948/14 delivered on 12 August 2016.
[7]
Case JA 87/10 delivered on 22 June 2012.
[8]
Novation means replacing an existing obligation by a new one, the
existing obligation being thereby discharged. See
:
Van Rooyen v Du Plooy
1985
1 SA 812 (T)
[9]
See:
Swadif
(Pty) Ltd v Dyke
1978 1 SA 928 (A).
[10]
Acacia
Mines
Ltd v Boshoff
1958 (4) SA 330
(AD).
[11]
See:
Rockliffe
v Mincom (Pty) Ltd
[2008] 29 ILJ (LC) para 26.
[12]
Collen
v Rietfontein Engineering Works
1948 1 SA 413
(A0) at 422.
[13]
At para 28 Steenkamp AJ (as he then was) stated that notwithstanding
that, it made the employee an offer to remain employed until
the
parties mutually agreed that the employee should retire.
The
contract of employment would continue on new mutually agreed terms.
[14]
In
Datt
my brother concluded that at the time of the applicant’s
dismissal the parties had not mutually agreed that he would retire.
His dismissal was a unilateral act by the respondent. This
conclusion suggests that unilateral determination of a retirement
age by an employer is unlawful.