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[2019] ZALCCT 24
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National Union of Mineworkers v Petra Diamond Mine Pty Ltd (Finsch Mine) (C145/14) [2019] ZALCCT 24 (23 April 2019)
IN
THE LABOUR COURT OF SOUTH AFRICA, CAPE TOWN
Not Reportable
case
no: C145/14
In
the matter between
NATIONAL
UNION OF MINEWORKERS
Applicant
and
PETRA
DIAMOND MINE PTY LTD
(FINSCH
MINE)
Respondent
Heard:
Trial heard by Everett AJ on 26-27 November 2015; Argument heard by
Rabkin-Naicker J on the 5 December 2018.
Delivered:
23 April 2019.
JUDGMENT
RABKIN-NAICKER
J
[1]
The trial in this matter was heard by Everett AJ in November 2015. I
am not privy
to the reasons for the long delay in delivering a
judgment in the matter. Suffice to say it was set down for the
hearing of argument
before me in December 2018. I was presented with
the pleadings in the matter as well as the transcript of the trial.
[2]
I intend to deal with the matter in a robust manner in order that the
members of the
Applicant on whose behalf the claim was made and the
respondent employer in this matter, are able to have the matter
finalised.
I am able to do that because there is a crisp legal point
which disposes of the matter, one which I canvassed with the parties
when legal argument was presented before me.
[3]
The NUM brought a claim in terms of section 197 of the LRA. In its
statement of claim
it pleads as follows:
“
5.1
On or about 14 September 2011, Respondent’s business (Finch
Mine) was transferred from De Beers
Consolidated Mines (De Beers),
the old employer of Claimant’s members, to Respondent, the new
employer (Petra).
5.2
Such transfer took place in terms of the provisions of sect 197 of
the LRA, and Respondent
has failed to comply with sect 197, more
particularly sects 197(2) and (3), in that Respondent has
unilaterally introduced terms
and conditions of employment that are
on the whole less favourable than those on which the transferred
employees were employed
by the old employer.
5.3
Such less favourable conditions apply as a condition precedent to an
immediately upon the
promotion of all employees of Respondent, who
are also members of Claimant….”
[4]
The following conditions are listed as the “changed and/or
newly introduced
Conditions of Service”: Medical Benefits,
Maternity Leave, Sick Leave, Educational Benefit, Pension Fund
Contributions, Polygraphing,
Underground Risk Allowance. The changes
affected individuals who applied for ‘promotion’ and in
effect meant that for
those individuals who did, and who signed a
contract to that effect, the new employer’s conditions under
the categories above
applied.
[5]
The legal issues for the Court to determine were pleaded as follows:
“
7.1
Whether the dispute is governed by sect 197 of the LRA, i.e., whether
the transfer of a business as
a going concern has taken place;
7.2
Whether Respondent has changed the conditions of service of
Claimant’s members, more
particularly those members whose names
appear on Annexure ‘A’;
7.3
Whether such changes, if found to be effected, comply with the
requirements of section 197(3)
of the LRA, i.e. whether the terms and
conditions of service were on the whole no less favourable after the
changes.”
[6]
On a perusal of the documents filed of record and the transcript of
the trial, it
was evident that at the time of the transfer of the
business on 14 September 2011 the NUM and the old employer, De Beers,
were
parties to a substantive collective agreement. The said
agreement covered the period 01 July 2011- 30 June 2013.
[7]
Section 197 of the LRA provides as follows:
“
197 Transfer
of contract of employment
(1)
In this section and in section 197A-
(a)
'business' includes the whole or a part of any business, trade,
undertaking or service;
and
(b)
'transfer' means the transfer of a business by one employer ('the old
employer') to another
employer ('the new employer') as a going
concern.
(2)
If a transfer of a business takes place, unless otherwise agreed in
terms of subsection (6)-
(a)
the new employer is automatically substituted in the place of the old
employer in respect
of all contracts of employment in existence
immediately before the date of transfer;
(b)
all the rights and obligations between the old employer and an
employee at the time of the
transfer continue in force as if they had
been rights and obligations between the new employer and the
employee;
(c)
anything done before the transfer by or in relation to the old
employer, including
the dismissal of an employee or the commission of
an unfair labour practice or act of unfair discrimination, is
considered to have
been done by or in relation to the new employer;
and
(d)
the transfer does not interrupt an employee's continuity of
employment, and an employee's
contract of employment continues with
the new employer as if with the old employer.
(3)
(a) The new employer complies with subsection (2) if that employer
employs transferred employees on terms and conditions that
are on the
whole not less favourable to the employees than those on which they
were employed by the old employer.
(b)
Paragraph (a) does not apply to employees if any of their conditions
of employment are determined by a collective agreement.
(4)
Subsection (2) does not prevent an employee from being transferred to
a pension, provident, retirement or similar fund other
than the fund
to which the employee belonged prior to the transfer, if the criteria
in section 14 (1) (c) of the Pension Funds
Act, 1956 (Act 24 of
1956), are satisfied.
(5)
(a) For the purposes of this subsection, the collective agreements
and arbitration awards referred to in paragraph (b) are agreements
and awards that bound the old employer in respect of the employees to
be transferred, immediately before the date of transfer.
(b)
Unless otherwise agreed in terms of subsection (6), the new employer
is bound by-
(i) any
arbitration award made in terms of this Act, the common law or any
other law;
(ii) any
collective agreement binding in terms of section 23; and
(iii) any
collective agreement binding in terms of section 32 unless a
commissioner acting in terms of section 62 decides
otherwise.”
(emphasis mine)
[8]
On a reading of section 197, the issue of whether conditions of
employment are on
the whole not less favourable after the transfer of
a business as a going concern, simply does not arise where a
collective agreement
is in place before and after transfer as it was
in casu. Such agreement is binding on the new employer unless an
agreement has
been entered into in terms of section 197(6). This was
not the case in this matter.
[9]
It follows therefore, that the route to be taken by the NUM in
circumstances in which
there was an alleged change to terms and
conditions of employment by the new employer after the transfer, was
one premised on collective
bargaining. In effect this route would
involve either a referral for interpretation of the collective
agreement(s) or industrial
action. I was informed by the parties that
they previously obtained an advisory arbitration award which found
that section 197
was not applicable to their dispute. There was
no copy of this in the record before me.
[10]
Another issue that needs traversing is the jurisdictional question
raised in the pleadings. Everett
AJ dealt with it at the start of the
trial. This involved whether section 197 disputes have to be
conciliated before coming to
the labour court. If they do, then it
was submitted that the Labour Court did not have jurisdiction.
Everett AJ made a ruling on
this issue i.e. that the Court had
jurisdiction and said she would give reasons for it in her judgment.
The ruling was correct
as conciliation is not prescribed for such
disputes.
[1]
[11]
Having raised and canvassed the question of the implications of the
collective agreement binding
the union and the old employer at time
of transfer with the party’s representatives, I have found that
the dispute between
the parties had to be resolved through the
interpretation of a collective agreement(s) or through industrial
action. Thus, I mero
motu raised a different jurisdictional issue to
that placed before Everett AJ, and find that the Labour Court had no
jurisdiction
to hear the matter. The claim therefore stands to be
dismissed. There is an ongoing relationship between the parties and I
will
not make a costs order in this matter.
[12]
In the premises, I make the following order:
Order
1. The
Claim is dismissed.
2.
There is no order as to costs.
__________________
H
RABKIN-NAICKER
Judge
of the Labour Court of South Africa
Appearances
For the Applicant: NUM
Official
For
the Respondent: Mervyn Taback Attorney
[1]
University of the Witwatersrand Johannesburg v Commissioner
Hutchinson & others (2001) 22 ILJ 2496 (LC)