THE LABOUR COURT OF SOUTH AFRICA, JOHANNESBURG

Not Reportable
Case no: JR1628/22

In the matter between:
THE STANDARD BANK OF SOUTH AFRICA Applicant

and
TUMISHO MOTSWEGE First Respondent
COMMISSIONER SHUMANI SIDNEY TSHAKAFA N.O. Second Respondent
THE COMMISSION FOR CONCILIATION, MEDIATION AND ARBITRATION Third Respondent
Heard: 4 July 2024
Delivered: 14 February 2025


JUDGMENT

MALULEKE, AJ

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Introduction

[1] This is an application to review an arbitration award under case no: GAJ5126-
22 in which the arbitrator found that the First Respondent, Tumisho Motswege, was
substantively unfairly dismissed by the Applicant.
[2] The arbitrator’s award further ordered that the Applicant reinstate the First
Respondent with retrospective effect from 1 August 2022 and directed the Applicant
to compensate the First Respondent with an amount of R125 373.92 by no later than 31 July 2022.
[3] The Applicant requires this Honourable Court to review and set aside the
arbitration award issued by the arbitrator on 18 July 2022, substituting the arbitration
award with an order that the dismissal of the First Respondent was substantively fair, alternatively remitting the matter to the CCMA to be arbitrated afresh by a
commissioner other than the arbitrator .

Background facts
[4] The First Respondent was employed by the Applicant as a Prestige Banker
earning a gross monthly salary to an amount of R26 718.02, she had been in the
employ of the Applicant since 1 September 2015. The First Respondent’s job description was for, inter alia, the opening of new accounts, transferring, amending and closing accounts in accordance with the Applicant’s laid down procedures. Further to the above, the First Respondent was required to gather and complete accurate dates for the opening of loan accounts and granting of facilities, to adhere to all internal risk -related policies and guidelines, obtain necessary customer
documentation as required by the Bank’s Know Your Customer policies and regulations; upload documentation on Bank’s system known as ECM and request customers to submit original documentation; validate the client’s regulatory status; refer matters outside scoring criteria with the appropriate information to credit evaluation and to apply a wide range of business knowledge to make decisions that are in the best interest of the Bank and the client.
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[5] In its founding affidavit, the A pplicant submits that under its Disciplinary Code,
dismissal is warranted if an employee fails to follow laid down procedures whic h
results in a financial loss. The Disciplinary Code further states that dis missal is also
warranted if an e mployee engages in any other act or behaviour which is considered
so serious that it destroys t he Bank’s ability to trust the employee or makes the
employment relationship intolerable for the Bank.

[6] The Applicant’s submissions are that , while the First Respondent was on duty
attending to calls in the Bank’s Customer Care Service Centre, a caller who
identified himself as Victor called and the First Respondent answered the call. The
caller purported to be Mr. Ntsikelelo Biyata, a client of the Bank who had a credit card account with the Bank and he informed the First Respondent that he was looking for a banker known as Timothy and because Timothy was engaged in
another telephone call at the time, the First Respondent offered to assist, Victor informed the First Respondent that he wanted to open a transactional account with the Bank. In doing so, the First Respondent was required to follow two security
steps. Firstly, the First Respondent was required to follow the XDS process which is
utilised to authenticate customers. Secondly, the First Respondent was required to follow the verification process which relates to the verification of the customer’s details using the Department of Home Affairs portal which also includes confirmation
of employment.
[7] The First Respondent followed the first step but failed to follow the second
step, being the verification process that relates to the customer’s details using the
Department of Home Affairs portal which includes confirmation of employment. After
following the first XDS step , the First Respondent simply opened Biyata’s profile and
proceeded to open the transactional account for Victor of a R200 000.00 personal loan and overdraft facilities of R48 200.00. Mr Biyata then disputed ever opening a transactional account of the aforesaid amounts.
[8] The Applicant then investigated the matter and the investigation revealed that
Mr Biyata was a victim of impersonific ation and as a result , the Applicant suffered a
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loss of R266 000.00 which was made up of the R200 000.00 personal loan, R48
200.00 overdraft facility, and interest and services fees. It is the Applicant’s
submission that the loss is squarely attributable to the First Respondent’s failure to
conduct the verification process that relates to the Department of Home Affairs portal which included the confirmation of employment.
[9] In her submissions, the First Respondent denies that the verification process
which relates to the verification of the customer’s details using the Department of Home Affairs portal is a prerequisite especially when dealing with existing clients. In
essence, according to her , such process is not required when you are dealing with
existing clients of the bank.

The award
[10] The arbitrator concluded that the First Respondent’s dismi ssal was
substantively unfair. The core of his reasoning was the following:
‘40. I am satisfied that the Respondent has proved that the Applicant had
failed to uphold the process laid down by the Respondent in terms of its procedure and as a result the Respondent suffers loss in the sum of R266 000.00. The Applicant failed to give satisfactory explanation as to why she did
not follow the process.
41. The Applicant testified that there were other employees who committed
some or similar offence, but they were not dismissed, instead they were issued with Final Written Warning. The Respondent had to satisfy me as to why it could not be expected to deviate from the dismissal sanction, since the policy provides for Final Written Warning and dismissal. The Respondent did not give satisfactory explanation as to why the other two e mployees were
issued with Final Written Warning and not dismissal. There is no satisfactory explanation why I should consider the sanction to be appropriate for this particular Applicant.
44. I am persuaded that the Respondent managed to discharge the onus
of showing that the Applicant committed the gross misconduct she was
charged and dismissed for. However, in terms of inconsistent application of
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the rule and sanction imposed, I am not convinced that the Respondent has
discharged it onus. The Respondent did not give satisfactory explanation for differentiation.
45. The Applicant has asked for reinstatement with retrospective effect.
After taking into account the entire evidence of the Respondent’s witnesses and that of the Applicant, I am persuaded that the Applicant’s dism issal was
substantively unfair. The Applicant made a case that the Respondent
dismissed her unfairly because there were other employees who committed same or similar offence as hers but were given Final Written Warning. One o f
those employees caused the Respondent substantial loss emanating from the breach of the Respondent’s rules.
46. On its own evidence the Respondent testified that the quantum was not
material. The bone of contention was whether the Applicant failed to follow the
processes laid in terms of its procedure. I found the argument to be without
merit that Innocentia Khalembashe was found guilty of breaching the rules of the Respondent. She was issued with a Final Written Warning. The
Respondent suffers a financial loss in the sum of R500 000.00 but certain amount was recovered. Mr. Serobatse Tlhokelwa was found guilty of
breaching the Respondent’s rules and causing a loss to the Respondent. He was also issued with a Final Written Warning.
47. The Applicant has no previous misconducts. She had a clean
disciplinary record. If these factors were taken into account, the Respondent would still issue the Applicant with Final Written Warning as prescribed in terms of the Disciplinary Code.
49. The Respondent did not submit reason as to why it should have
deviated from the disciplinary policy and not to impose a sanction short of
dismissal such as Final Written Warning as it did to other two employees who were found guilty of same offence of breaching the rules of the Respondent,
as the Applicant. ’

Review test, legal principles and evaluation

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[11] Section 145(1) of the Labour Relations Act1 (LRA) reads as follows:
‘Any part y to a dispute who alleges a defect in any arbitration proceedings under the
auspices of the C ommission may apply to the Labour Court for an order setting aside
the arbitration award... ’

[12] Section 145(2)(a) and (b) of the LRA further provides the following:
‘(2) A defec t referred to in subsection (1), means –
(a) that the commissioner –
(i) committed misconduct in relation to the duties of the commissioner as
an arbitrator;
(ii) committed a gross irregularity in the conduct of the arbitration
proceedings; or
(iii) Exceeded the commissioner ’s power s; or
(b) that an award has been improperly obtained. ’
[13] The Sidumo test remains the landmark judgment in review applications,
therefore this Honourable Court is obliged to consider reasonableness test as postulated by the Constitutional Court in Sidumo and Another v Rustenburg Platinum
Mines Ltd and Others
2. The question is therefore whether the decision arrived at by
a commissioner is one that a reasonable decision- maker could reach, having regard
to the material properly before them.3
[14] The Labour Appeal Court in Gold Fields Mining South Africa (Pty) Ltd (Kloof
Gold Mine) v Commission for Conciliation, Mediation and A rbitration and Others
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held that 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 arbit rator misconceived the inquiry. In the final analysis, it will depend on the
materiality of the error or irregularity and its relation to t he 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

1 Act 66 of 1995, as amended.
2 [2007] ZACC 22; 2007 12 BLLR 1097 (CC).
3 Ibid at para 268.
4 [2013] ZALAC 28; [2014] 1 BLLR 20 (LAC) at para 33.
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the inquiry, 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 th e determination of the dispute. A material error of this
order would point to at least a prima facie unreasonable result.
[15] Item 3(6) of the Code of Good Practic e: Dismissal
5 (Code) outlines that the
employer should apply the penalty of dismissal consistently with the way in which it
has been applied to the same and other employees in the past and consistentl y as
between two or more employees who participate in the misconduct under consideration.

[16] The legal principles applicable to consistency in the exercise of discipline are
set out in item 7 (b)(iii) of the Code “establishes as a guideline for testing the fairness
of a dismissal for misconduct whether ‘ the rule or standard has been consistently
applied by the employer ’”
6. This is often referred to as the parity principle, a basic
tenet of fairness that requires like cases to be t reated alike. The c ourts have
distinguished two forms of inconsistency i.e. historical and contemporaneous
inconsistency . The former requires that an employer apply the penalty of dismissal
consistently with the way in which the penalty has been applied t o other employees
in the past; the latter requires that the penalty be applied consistently as between
two or more employees who commit the same misconduct.7 A claim of inconsistency
(in either historical or contemporaneous terms) must satisfy a subjective element.
[17] An inconsistency challenge will fail where the employer is able to differentiate
between e mployees who have committed similar transgressions on the basis of inter
alia, differences in personal circumstances, the severity of the misconduct or on the
basis of other material factors.
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5 Schedule 8 of the LRA.
6 Southern Sun Hotel Interests (Pty) Ltd v Commission for Conciliation, Mediation & Arbitration &
others [2009] ZALC 68; (2010) 31 ILJ 452 (LC) at para 10.
7 See: Van Niekerk , N Smit , BPS Van Eck et al “Law@ Work”, LexisNexis South Africa , 6th ed.
8 See: Early Bird Farms (Pty) Ltd v Mlambo [1997] 5 BLLR 541 (LAC) at 545 H -I; NUM v Council for
Mineral Technology [1998] ZALAC 22; [1999] 3 BLLR 209 (LAC) at para 20.
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[18] Further more , the Labour Appeal Court has held that employees cannot profit
from an e mployer’s manifestly wrong decision in the name of inconsistency.

[19] In SA Commercial Catering and A llied Workers Union and Others v Irvin &
Johnson Ltd9, the Labour Appeal Court summed up the principle of parity as follows:
‘The best that one can hope for is reasonable consistency. Some
inconsistency is the price to be paid for flexibility, which requires the exercise
of a discretion in each individual case. If a chairperson conscientiously and
honestly, but incorrectly , exercises his or her discretion in a particular case in
a particular way, it would not mean that ther e was unfairness towards the
other employees. It would mean no more than that his or her assessment of
the gravity of the disciplinary offence was wrong. It cannot be fair that other
employees profit from that kind of wrong decision. … [A] wrong decision can
only be unfair if it is capricious, or induced by improper motives or, worse, by
a discriminating management policy .’
[20] In NUM and Another v Amcoal Colliery t/a Arnot Colliery and Another
10, the
Labour Appeal Court held that the parity principle was designed to prevent unjustified selective punishment or dismissal and to ensure that like cases are treated alike. It was not intended to force an employer to m ete out the same
punishment to employees with different personal circumstances just because they
are guilty of the same offence.

[21] For purposes of the subject matter , it is essential to note that in today’s world
impersonification occurs from time to time and therefore it has become a norm of the
day. It is therefore of crucial importance that in order t o safeguard the resources of
banking institutions in particular more and/or extensive verification processes as
outlined by the rules of that institution mus t be fully complied with to the latter .
[22] Furthermore, in casu , the First Respondent admitted to having failed to
comply with the rules as outlined by the Applicant stating that she was not required

9 [1999] ZALAC 17; (1999) 20 ILJ 2302 (LAC) at para 29.
10 [2000] 8 BLLR 869 (LAC) at para 19.
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to since this was an existing client of the b ank and/or the Applicant. The First
Respondent’s version in this regard lacks credibility and must be rejected outright.
The basis for this assessment is that verification processes remain the cornerstone of the security system of banking institutions and therefore, employees must ensure
that at all material tim es, such processes are complied with to the latter, which the
First Respondent failed to do in this instance.

[23] The arbitrator’s ruling in casu is purely based on the principle of parity and/or
inconsistent application of discipline. The principle however cannot be the only factor
to determine whether the dismissal is fair or unfair, therefore each matter will still be determined based on its own merits.
[24] Section 145 of the LRA requires that the outcome of arbitration proceedings ,
as represented by the commissioner’s decision, must fall within a band of
reasonableness but this does not preclude this Honourable Court from scrutinising the process in terms of which the decision was made. If a commissioner fails to take material evidence into account, or has regard to evidence that is irrelevant, or the
commissioner commits some other misconduct or a gross irregularity during the proceedings under review and a pa rty is likely to be prejudice d as a consequence,
the commissioner’s decision is liable to be set aside regardless of the result of the proceedings or whether on the basis of the record of the proceedings that result is nonetheless capable of justification.
[25] With this background, I turn now to consider the Applicant’s challenge to the
award as it relates to the transcribed record of the arbitration proceedings.
[26] The exchange between the First Respondent’s Attorney, Mr Chauke and the
Applicant’s witness, Ms Wilson demonstrates that the circumstances and the charges which were faced by the First Respondent and Khalembashe were quite
distinct, although in both instances there was a financial loss, in Khalembashe’s
case, some funds from the R500 000.00 loss were recovered.

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[27] It is evident from the record of the CCMA proceedings that the arbitrator’s
finding that the Khalembashe matter and that of the First Respondent are similar is
not supported by the testimony adduced during the CCMA arbitration proceedings.
[28] Furthermore, it is evident from the record of the CCMA arbitration proceedings
that the First Respondent has failed to take any responsibility relating to the loss suffered by the Applicant except to state that she was not required to conduct any
verification process which is related to the verification of the customer’s details using
the Department of Home Affairs portal which, in the view of this Honourable Court , if
she did conduct such verification this would have reduced the risk of the Applicant’s exposure to the loss suffered.
[29] In view of the abovementioned, it is clear that the arbitrator failed to take note
of the First Respondent’s lack of remorse during the arbitration proceedings which is ,
in my view, a contributory factor that ought to have been taken into consideration.
[30] The Code makes reference to dismissal and it is very clear on the guideline s
for an appropriate sanction. In terms of the Code, it is not appropriate to dismiss an
employee for a first offence except if the misconduct is serious and of such gravity
that it makes a continued employment relationship intolerable.
[31] In deciding on a balanced sanction and/or ruling, consideration must be given
to the circumstances of the offence, the circumstances of the e mployee as well as
the interest of the employer and the other employ ees, the message sent to other
employees regarding misconduct of that nature and more importantly , a lack of
acknowledge ment of wrongdoing and/or remorse on the part of the employee.
[32] In light of the above, it is clear that the First Respondent has , throughout the
arbitration proceedings , denied any responsibility over the loss suffered by the
Applicant and therefore effectively no remorse was shown by the First Respondent whatsoever.

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[33] It is of crucial importance to note that this Honourable Court finds that the
principle of parity , as raised by the First Respondent , to be baseless in that no
similarities were identified in the matter of Khalembashe and that of the First
Respondent.

[34] The Applicant therefore cannot be expected to continue repeating a wrong
decision in obeisance to a principle of consistency even in instances where no
similarities have been identified likewise in the subject matter.

[35] With this background, it is the decision of this Honourable Court that the
arbitrator has failed to objectively consider all the relevant factors and this
necessitate s the review and setting aside of the award.
[36] In the premises, I make the following order:

Order
1. The arbitration award granted by the Second Respondent on 18 June
2022 under case no: GAJB5126- 22 is reviewed and set aside;
2. The Second Respondent’s a ward is substituted with an order that the
dismissal of the First Respondent is substantively fair;
3. There is no order as to costs.
S Maluleke
Acting Judge of the Labour Court of South Africa.

Appearances :
For the A pplicant: Mr Doctor Cithi
Instructed by: Mervyn Taback Inc
For the R espondent: Mr. Cliven Chauke
Instructed by: Shinyori Chauke Inc