About SAFLII
Databases
Search
Terms of Use
RSS Feeds
South Africa: Cape Town Labour Court, Cape Town
SAFLII
>>
Databases
>>
South Africa: Cape Town Labour Court, Cape Town
>>
2025
>>
[2025] ZALCCT 21
|
|
Phasha v Pandora Jewellery South Africa (Pty) Ltd (C91/2022) [2025] ZALCCT 21; [2025] 6 BLLR 627 (LC) (7 April 2025)
FLYNOTES:
LABOUR – Remuneration –
Bonus
commission
–
Based
on store achieving 525,5% of the stipulated sales target –
Store sales target was set overseas by the head office
in Italy –
Sales targets for stores in other malls were significantly higher
– Employee doubted the correctness
of target set for the
store – Figure was an error – Could not be relied on
to establish an entitlement to the
bonus claimed –
Plaintiff’s claim dismissed.
THE LABOUR COURT OF
SOUTH AFRICA
AT CAPE TOWN
Of interest to other
judges
Case
no:
C
91/2022
In
the matter between:
MMATLAWA
NTEBOGENG NADINE PASHA
Plaintiff
and
PANDORA
JEWELLERY SOUTH AFRICA (PTY) LTD
Defendant
Delivered
:
7 April 2025
Summary:
(
Claim for unpaid bonus commission – Concession made by
defendant in pre-trial minute not at odds with the facts - Claim not
proven on a balance of probabilities – with prejudice offer of
settlement made -costs – civil matter – costs
awarded on
magistrates court scale)
JUDGMENT
LAGRANGE J
Introduction
[1]
The plaintiff, Ms N Phasha (‘Phasha’) claims she was due
payment of a bonus commission from the defendant
(‘Pandora’)
for the month of November 2021, amounting to R 44,000. This was based
on the store in which she worked
in the V&A Waterfront achieving
525,5 % of the stipulated sales target. Instead, Phasha was only paid
a bonus commission of
R 3,000. She is claiming the balance of R
41,000, which she says is due to her. Pandora contends that Phasha’s
claim was
based on a 525,5% target was plainly an error, which it was
entitled to correct, but in any event denies it was contractually
obliged
to pay any bonus commission.
[2]
At the commencement of the trial proceedings, Pandora raised an
in
limine
issue, which had been pleaded as part of its defence, but
not raised as a matter to be determined before the trial could start.
It claimed that on 3 July 2021, a new performance incentive scheme
was agreed to by Phasha, which stipulated that it replaced all
previous commission structures in her contract of employment, which
included the bonus commission scheme. Accordingly, it argued
there
was no contractual basis for her claim to the bonus commission for
November 2021. Phasha claimed it was necessary to lead
oral evidence
to determine this preliminary issue and, after hearing oral argument
from the parties, the court agreed to hear oral
evidence before
determining this preliminary issue.
[3]
Only Phasha gave evidence. After hearing evidence and argument, the
court dismissed Pandora’s
in limine
point. In
consequence, the only point resolved by the
in limine
ruling
was that whatever the prevailing contractual bonus scheme was, it was
not amended by her written acknowledgment of a new
performance
incentive scheme on 3 July 2021.
[4]
By the time the trial resumed on 10 June 2024, the parties had agreed
that no further evidence would be led and that the
merits of the
claim should be argued. Before it resumed, Pandora had made an offer,
with prejudice, to settle the dispute by offering
to pay the capital
amount and interest claimed by Phasha and to pay her costs at the
magistrates’ court scale. However, Phasha
rejected the offer of
settlement, apparently because she could not agree to the amount
tendered for her costs. Consequently, the
parties proceeded to argue
the merits of the case on the second day of the trial.
Merits
[5]
It was common cause as reflected in the pre-trial minute, that :
“
2.2 Initially, in
addition to the applicant’s salary, she was entitled to earn a
commission, which was a monthly commission
on the percentage
achievement of the sales budget, above 50 % and
2.3 The Applicant was
further entitled to receive a bonus commission monthly in arrears,
calculated at R 1,000-00 for every 10 %
that the sales target is
exceeded.”
[6]
Pandora’s defence was that the commission structure set out in
the paragraphs above had been amended by the new
performance
incentive scheme which took effect on 1 July and Phasha had agreed to
on 3 July 2021. On the face of the preliminary
ruling, that defence
should have fallen away.
[7]
Pandora relies on two other arguments. Firstly, notwithstanding the
in limine
finding, it argued that Phasha had failed to prove
the existence of the written contract she had relied on in her
statement of
case. Secondly, it had pleaded that the target for
November 2021 was erroneously calculated and recorded as R 92,745.00,
whereas
the correct target was R 550,000.00. Moreover, any amendment
of the target was legally binding on all affected employees,
including
Phasha.
[8]
In her statement of case, Phasha had claimed that she had been
employed by Pandora on 4 December 2017 under a written
contract,
which
inter alia
provided for payment of a bonus commission as
set out in the provisions of the pre-trial minute cited in paragraph
5 above. That
contract had been amended on 15 May 2019. A copy of the
signed amendment was attached to her statement of claim. That
amendment
concerned her appointment as a store manager. At the end of
the amendment, it was confirmed that:
All
terms and conditions of original signed employment contract are still
applicable and remain valid during employment with Pandora
Jewellery
South Africa (Pty) Ltd.”
(
sic
)
Accordingly,
to the extent that she was contractually entitled to the bonus
commission before signing the amendment, she retained
that
entitlement.
[9]
It is common cause, Phasha could not produce a copy of the original
written contract on which her claim was based. However,
whether she
was able to produce that document or not, Pandora had agreed in the
pre-trial minute that Phasha was entitled to the
bonus commission
described in paragraphs 2.2 and 2.3 of the minute. It did not dispute
her entitlement but only contended that
it had been scrapped when she
agreed to a new performance incentive scheme in July 2021, which
contention fell away with the
in limine
finding.
[10]
That being the case, whether Phasha could provide a copy of the
original written contract or not, Pandora had conceded
her
entitlement to the bonus commission in question. It was also not
contended that no bonus commission was payable for November
2021,
only that the amount due was far less than what Phasha claimed
because her claim was based on a patently erroneous calculation.
In
conclusion, I cannot agree that the failure of Phasha to produce the
written contract in question is fatal to her claim she
was
contractually entitled to the bonus commission, given that the very
basis of Pandora’s primary defence was that the entitlement
had
been done away with when the new performance incentive had been
introduced, which defence has been disposed of by the
in limine
finding. It was not necessary for her to amend her statement of
claim in view of the Pandora’s admission that she had an
entitlement
to the bonus.
[11]
However, Pandora persists
in arguing that merely because it appears that it had admitted she
had been entitled to the bonus provision
before the purported
amendment in July 2021, that does not mean the court should accept
that her prior contractual entitlement
was established. In support of
this argument, Pandora cited the case of
Fourie
v Sentrasure BPK
[1]
which affirmed the following dictum in
Rance
v Union Mercantile Co Ltd
[2]
,
in which it was stated:
'When an
admission is formally pleaded, it as a rule corresponds to fact. But
what if it does not? In such a case the party making
the admission is
no doubt bound to the extent of the admission (as long as it stands),
but assuming that the admission is not in
accordance with fact, a
court of law by assuming its correctness and by building upon it for
the purpose of ascertaining the limits
of the contract erroneously
admitted, may find a contract proved which has no existence in fact,
and which but for such admission
it would not have found to be
proved. This shows that it is not always safe to build further upon
the mere admission of a contract.
The fact of the matter is the party
making the admission is bound by it to the extent to which the
admission goes. To press it
against him beyond that, under all
circumstances, may lead to inequitable results.'
[3]
[12]
However, in this case, it is by no means obvious that the concessions
made by Pandora were plainly at odds with other
evidence to the
contrary. All that can be said is that Phasha had failed to produce
the actual contract she concluded in 2017.
However, an unsigned
contract of a store manager contained the contract provision dealing
with the bonus commission in question
and, it was undisputed that she
was paid the bonus commission in accordance with the formula which
appears there. Moreover, it
was undisputed that she was paid such a
commission in accordance with the same formula before she became a
store manager and it
was common cause that at all times she was
always employed by Pandora her employment was governed by a written
contract. The probabilities
that she was paid a bonus commission
which was not in her written contract in 2017 are remote. If
anything, the concession made
in the pre-trial minute is more aligned
with the probable existence of such a provision in her 2017 contract
of employment than
not. In the circumstances, I do not find that the
dictum
in
Fourie
is applicable on the facts of this
case.
[13]
The next question is whether Pandora can escape liability on the
basis of a bona fide mistake about the calculation of the target
achieved.
The firm argued that Phasha made
significant concessions regarding whether her claim was based on a
genuine error in setting the
target sale figure.
[14]
She had testified that the store sales target was
set overseas by the head office in Italy. The sales target for the
Victoria and
Albert store where she was a manager was set at R 92,000
for November 2021. Phasha agreed that the sales targets for stores in
other malls were significantly higher. For example, November 2021
sales targets for the stores in La Lucia, Eastgate and Canal Walk
malls were set at R348,000, R729,000 and R 1.027 million
respectively. She testified that because the V & A store target
was
so low she queried it with the regional store manager, who asked
the financial department in head office, which confirmed that the
target figure was correct. When the November 2021 sales figure became
known, it had exceeded the stated targeted figure by 447%.
By
comparison, the November sales figures for the La Lucia, Eastgate and
Canal Walk malls in relation to the targets set for those
stores were
15 % and 19% below, and 6% above, respectively. The staff at the V&A
store wanted clarity on what they would get
after they learned they
had apparently achieved sales equivalent to 547% of the target. There
was considerable delay on the part
of the company in responding to
their enquiry. Eventually, they were told in December 2021 that the
target was supposed to have
been R 550,000, but the company was
prepared to reduce this to R 450,000. Phasha said it was never
explained how the R 550,000
figure was arrived at. Nevertheless, it
was on the basis of the revised figure that Phasha received a bonus
of R 3000. Phasha agreed
that she had never received a large bonus
like the one she was claiming before.
[15]
From the limited evidence it is apparent, right
from the start, that Phasha herself doubted the correctness of the
sales target
set for the store. Even though it was initially
confirmed by the finance department, it was more than R 240,000 lower
than the
lowest target of any other store, which happened to be the
La Lucia store having a sales target of R 348,000 for November 2021.
The V&A store sales target was markedly below the level of any
other store. Phasha could not dispute that it was even below
the
monthly cost of the store rental. When the sales results were known,
the V&A results were equally extraordinary compared
to the
store’s own target sales figure and compared with the relative
performance of other stores. This only serves to emphasise
how
anomalous and improbable the target sales figure for the V&A
store was.
[16]
Whatever the correct sales target should have
been, based on the evidence discussed above, it is most unlikely that
it could have
been in the region of the figure of R 92,000, even
though it was initially identified as correct. Plainly an error was
made and
that figure could not be relied on to establish an
entitlement to the bonus claimed. Consequently, I am not satisfied,
on a balance
of probabilities, that Phasha has proven her entitlement
to a bonus of R 44,000-00 for November 2021.
Costs
[17]
Pandora made a “with prejudice” offer
to pay Phasha her full claim, and to pay her costs on the magistrate
court scale.
The fact that she rejected what was a very reasonable
offer, given the merits of her case, is something the court can
consider
in deciding if it would be appropriate to make an adverse
cost order against her. It appears the only stumbling block to her
accepting
the offer was that the costs which would be paid were at
the magistrate’s court scale.
[18]
S
162(1) of the Labour Relations Act, 66 of 1995 (‘the LRA’)
permits this court to make an order of costs, according
to the
requirements of law and fairness. Generally, the approach of the
Labour Courts is to follow the approach laid down by the
Constitutional Court in
Zungu
v Premier of the Province of KwaZulu-Natal & others
[4]
,
namely that the normal practice is not make cost awards. However, in
Baise v
Mianzo Asset Management (Pty) Ltd
[5]
,
the Labour Appeal Court held that in a civil claim, absent special
circumstances, costs should follow the result.
[6]
It was argued that the Labour Court is a specialist court and that
Phasha was entitled to have her case heard in this forum. That
statement is correct, but its specialist jurisdiction concerns its
sole remit to determine matters assigned to it in terms of the
LRA.
In civil matters, it is determining disputes on the same principles
that are applicable in civil proceedings in the magistrate
and high
courts. There was no reason why this case could not have been
conducted in a magistrate’s court, given the quantum
of the
claim. Pandora’s offer to pay Phasha’s costs on the
magistrate’s court scale of fees was not inappropriate
and she
ought to have accepted the offer instead of proceeding with her
claim.
[19]
In the circumstances, Pandora incurred the unnecessary cost of
preparing and presenting argument on 10 June 2024, and I see no
reason why it should bear the ordinary costs thereof.
Order
1. The Plaintiff’s
claim is dismissed.
2. The Plaintiff
must pay the Defendant’s costs of preparing and presenting
argument on 10 June 2024 on the magistrates
court scale of costs.
R G Lagrange
Judge
of the Labour Court of South Africa
.
Appearances:
For the
Applicant:
F Cronje from Cronjes Incorporated Attorneys
For the
Respondent: Adv T du Preez
Instructed
by:
Van der
Spuy and Partners
[1]
1997(4)
SA 950 (NC)
[2]
1922
AD 312
[3]
Rance
at
315.
[4]
(2018) 39
ILJ
523 (CC) at paragraphs
23 -25.
[5]
(2019) 40
ILJ
1987 (LAC)
[6]
At
paragraph 48.