Summary of Judgment

1. Introduction

This matter concerned an opposed review application in the Labour Court to review and set aside an arbitration award issued under case number NWRB92-16. The applicant was Sunbake Bakery Rustenburg (the employer). The respondents were the Commission for Conciliation, Mediation and Arbitration (first respondent), Commissioner Kenneth Dlamini (second respondent), NUFBWSAW (third respondent), and Kumo Sehunoe (fourth respondent, the employee).

The procedural history reflected that the fourth respondent was dismissed following disciplinary charges. A dispute proceeded to arbitration at the CCMA, where the commissioner found the dismissal procedurally and substantively unfair and ordered reinstatement with back-pay. The employer then approached the Labour Court to review and set aside that award.

The dispute’s subject-matter was whether the arbitration award was reviewable on the basis that the commissioner failed properly to perform the arbitration enquiry—specifically in relation to the commissioner’s approach to the evidence underlying the charges of gross insolence and insubordination—and, if so, what remedy the Labour Court should grant (setting aside and substitution, or remittal for rehearing).

2. Material Facts

It was undisputed that the employee had lodged a grievance against her direct superior, Mrs Stapelberg, on 23 November 2015, and that the employer did not address that grievance. It was further undisputed that on 27 November 2015 the employee was suspended and then charged with misconduct.

The charges that led to dismissal were gross insolence (being disrespectful, rude, and abusive toward her direct superior), insubordination (failure to provide feedback or action tasks assigned by her direct superior), and gross negligence (failure to action payroll input accurately and timeously). The arbitration resulted in a finding that the dismissal was unfair both procedurally and substantively, with an order of reinstatement and back-pay.

In relation to the first two charges (gross insolence and insubordination), the arbitration record (as reflected in the award excerpts quoted in the judgment) contained conflicting versions about whether the employee screamed at the superior, the nature of the altercation, and who raised their voice. The employee’s version included that she raised her voice in retaliation and suggested she was charged and dismissed because she had lodged a grievance. The employer’s witnesses, as summarised by the commissioner, alleged that the employee screamed and acted in a manner disrespectful to authority.

A material feature for the Labour Court’s decision was not which version was correct on the merits, but that the commissioner stated that it would “not be prudent” to consider the allegations linked to those charges because they were linked to the prior grievance and because no evidence was presented that the grievance was dealt with.

3. Legal Issues

The central legal questions were whether the commissioner committed a reviewable irregularity by misconceiving the nature of the enquiry and failing to determine, on all the evidence before him, whether the employer had proved the charges on a balance of probabilities in a de novo arbitration hearing.

The dispute before the Labour Court primarily concerned the application of legal standards governing review to the commissioner’s conduct of the arbitration and reasoning process. In particular, it concerned whether the commissioner’s approach amounted to a failure to apply his mind to material considerations, and whether that failure caused him not to address the true question for determination, namely the fairness of dismissal on the charged misconduct.

A further issue was remedial: if the award was to be reviewed and set aside, whether the Labour Court should substitute its own decision or remit the matter for rehearing, taking into account the nature of the disputes and the need for credibility findings.

4. Court’s Reasoning

The Labour Court identified the proper arbitration enquiry as requiring the commissioner, in a de novo hearing, to assess all the evidence and determine whether the employer had proven the employee’s guilt on the charges on a balance of probabilities, and thereafter to assess whether dismissal was fair. The court considered the commissioner’s stated refusal to consider the allegations relating to gross insolence and insubordination to be inconsistent with that enquiry.

The court held that the commissioner’s approach illustrated a commissioner misconceiving the nature of the enquiry. Instead of evaluating the evidence relevant to the charges, the commissioner declined to do so because of a value judgment linked to the employer’s failure to deal with the grievance. The Labour Court treated this as a failure properly to apply the commissioner’s mind to material considerations bearing on the charges and the fairness of dismissal. This failure, in the court’s view, resulted in the commissioner not addressing the question that the evidence required him to determine—whether dismissal for those charges was fair.

In reaching that conclusion, the court indicated that the commissioner’s failure to engage with material evidence and the issues for determination rendered the award susceptible to review, with reference to the review principles associated with misconceived enquiries and material misdirection, as reflected in the authorities cited by the court.

On remedy, the court concluded that the dispute should be remitted to the CCMA for rehearing rather than substituted. The court emphasised that substitution was inappropriate given the importance of credibility findings that would need to be made. The court also noted that, because the employer criticised the manner in which the commissioner questioned the parties, reliance on the existing record would not be appropriate, reinforcing the need for a fresh rehearing before a different commissioner.

Finally, the court declined to award costs, reasoning that the fourth respondent was an individual defending the award.

5. Outcome and Relief

The Labour Court reviewed and set aside the arbitration award issued under case number NWRB92-16.

The dispute was remitted to the CCMA for rehearing before a commissioner other than Commissioner Kenneth Dlamini.

No order as to costs was made.

Cases Cited

Herholdt v Nedbank Ltd (Cosatu as Amicus Curiae) 2013 (6) SA 224 (SCA).

Palluci Home Depot (Pty) Ltd v Herskowitz & others (2015) 36 ILJ 1511 (LAC).

Legislation Cited

No legislation was cited in the judgment text provided.

Rules of Court Cited

No rules of court were cited in the judgment text provided.

Held

The court held that the arbitration award was reviewable because the commissioner misconceived the nature of the arbitration enquiry by declining to evaluate evidence relating to the charges of gross insolence and insubordination on the basis that the allegations were linked to an unresolved grievance. This constituted a failure to apply his mind to material issues and resulted in him not determining the fairness of the dismissal on the evidence.

The court held that the appropriate remedy was to set aside the award and remit the matter for rehearing before a different commissioner, given that credibility findings were necessary and reliance on the existing record was inappropriate. The court made no costs order.

LEGAL PRINCIPLES

The judgment applied the principle that in CCMA arbitration proceedings concerning dismissal, the commissioner is required to conduct a de novo enquiry and determine, on the totality of the evidence, whether the employer has proven the alleged misconduct on a balance of probabilities, and then to determine whether dismissal was fair.

The judgment further applied the review principle that an award is susceptible to review where the commissioner misconceives the nature of the enquiry or fails to apply their mind to material considerations, with the result that the commissioner does not address the real question that must be determined on the evidence.

On remedy, the judgment applied the principle that remittal (rather than substitution) is appropriate where the dispute requires credibility assessments and where the reviewing court considers it inappropriate to determine the matter on the record, including where concerns are raised about the conduct of the proceedings and the manner in which evidence was elicited.