THE LABOUR COURT OF SOUTH AFRICA, JOHANNESBURG
Not Reportable
Case No. JS 439/17
In the matter between:
NEHAWU obo FREDDY MASILELA AND 20 OTHERS Applicant
and
SOS CHILDREN’S VILLAGE SOUTH AFRICA Respondent
Heard: 18-20 August 2025
Delivered: 12 September 2025
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JUDGMENT
___________________________________________________________________
BALOYI, AJ
Introduction
[1] Freddy Masilela and 20 others referred an unfair dismissal dispute based on
operational requirements to this Court for adjudication. The d efendant
dismissed them on 21 December 2015. The subsequent conciliation of the
unfair dismissal dispute before the CCMA result ed in the issuing of the
certificate of non- resolution, hence, its referral to this Court. The d efendant
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maintains that their dismissal wa s both substantively and procedurally unfair.
The defendant, on the other hand, holds a view that there was a fair reason to
retrench the plaintiffs and such retrenchment was effected in accordance with
fair procedures.
[2] The plaintiffs were employed by the defendant on various dates and served in
various centres, referred to as villages , where the defendant carried out its
operations. The plaintiffs w ere general workers, gardeners, handymen, etc.
The defendant is a registered non- profit organisation that provides care for
children who require parental care for an extended period. The defendant was
receiving funding from three main sources in order to carry out its operations,
namely, the g overnment, international organisations and individual donors
from the general public.
[3] Tebogo Ramela (previously Tebogo Matshwi ) testified in support of the
defendant’s case that she was the defendant’s Human Resources Manager
between January 2014 and May 2016. She was involved in the processes that
led to the dismissal of the plaintiffs. The process began with communication to
the union representatives and village heads . A roadshow was conducted
throughout nine villages under the defendant’s portfolio to sensitise
employees about the intended retrenchment process. This occurred after the
defendant was informed that international donors were no longer willing to
fund the South African operations, as South Africa is considered self -
sustainable. The gap created by the withdrawal of funding led the defendant
to make a difficult decision on whether to continue feeding the children or
retain employees in its workforce.
Background
[4] On 12 June 2015, the defendant held the first meeting with union
representatives at its head office, in which the issue of restructuring was
communicated to the employee representatives through a pie chart
presentation. They were informed that certain employees would be affected.
presentation. They were informed that certain employees would be affected.
road shows were to be conducted before the commencement of retrenchment
consultations. Three meetings were held on 16 September 2015, 6 November
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2015, and 9 December 2015. The union was not cooperative as it shifted the
goal posts by requesting information and challenging the presence of its
advisor, Mr Tony Healy. The defendant relied on the EOH report to arrive at a
decision to embark on a retrenchment exercise.
[5] The new structure contained a lot of changes and job descriptions. 70
affected employees were to apply for 54 positions appearing in the new
structure. In villages where union representatives did not attend consultation
meetings, the defendant proceeded with individual employees after securing
their consent to proceed without union representation. Only three people
accepted voluntary retrenchment offers. 28 employees were ultimately
retrenched, 21 of whom were NEHAWU members. The new structure was
implemented in 2016, and the positions of the retrenched employees do not
exist in the new structure.
[6] It came to light during cross -examination that the EOH report that the
defendant referred to was, in fact, a request for proposal in terms of which the
defendant was looking for service providers to assist with the re-organisation
of its villages in South Africa. The actual report relevant to the restructuring
was not provided to the union and does not form part of the trial bundle. Ms
Ramela maintained that all the meetings constituted consultations and could
not recall if the plaintiffs made proposals for an alternative to retrenchment.
[7] Freddie Laban Masilela, the plaintiff’s first witness, was an admin assistant
based in Mamelodi village. He was also a NEHAWU shop steward. Mr Hitler
Sekgitla and the shop stewards represented NEHAWU between June and
December 2015. Not all meetings resulted in an agreement between the
parties, as the union representatives were at some point unable to engage
with the defendant due to the absence of a mandate and inadequate
information. He viewed the meetings as having collapsed. He did not apply for
a job in the new structure because he did not know the reason for his
a job in the new structure because he did not know the reason for his
retrenchment. His position and the job description still existed in the new
structure, it was only the name that changed. He received a letter dated 10
December 2015, inviting him to a consultation on 18 December 2015. He
went to the identified venue in Mamelodi village. He and other union
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representatives arrived late, and there were employees outside the meeting
venue who had already received retrenchment letters. He attended to them
whilst Mr Sekgitla went inside to meet with the defendant’s representatives.
He was retrenched on 21 December 2015.
[8] The plaintiff’s second witness, Seleka Hitler Sekgitla , is the NEHAWU’s
National Organiser for the Social Development Sector. His engagement on
the matter started with communication between himself and Tebogo Ramela
about the defendant’s intention to restructure. At the first meeting on 12 June
2015, Ms Ramela indicated that the defendant intended to undertake an
organisational review, and certain employees in various villages would be
affected. It was agreed that consultation would take place on a centrali sed
basis, as it might be costly to travel from one village to another. The employee
representatives were not against the road show that was intended to sensitise
the employees about their future relationship with the defendant. These road
shows, however, resulted in misrepresentation as he received complaints that
the employees based in villages were told that the union had agreed to
retrenchments, whilst it was not the case.
[9] Information was requested, including the EOH report, which the defendant
relied on, and both the old and new organisational structures. Whilst awaiting
receipt of the requested information, the defendant addressed notices in
terms of section 189 to individual employees, dated 23 July 2015, informing
them of the looming structural changes and calling for voluntary
retrenchments by 31 July 2015. An invitation dated 21 August 2015 was
addressed to individual employees for a consultation meeting on 24 August
2015. The defendant had not, at this point, provided the information requested
by the union.
[10] On 31 August 2015, the defendant issued a communication addressed to
employees informing them that consultations with the union would commence
employees informing them that consultations with the union would commence
on 11 September 2015, and it was anticipated that such consultations would
be completed by the end of December 2015. Things began to change when
Tony Healy was brought in. T he defendant disregarded the program that the
union agreed to with the Human Resources department.
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[11] In the meeting of 16 September 2015, the defendant appeared to have had
consultation in mind. The requested information was still outstanding, and
there was no agenda. The union reminded the defendant of the outstanding
information, which was recorded in the minutes. The meeting was concluded
on a note that the defendant would respond to the points raised and requests
made by the union. The next meeting was to be co- ordinated between Ms
Ramela and Mr Sekgitla.
[12] The union objected to Mr Healy's participation, which was viewed as a costly
exercise amid the defendant’s claims of being cash -strapped. The issue was
resolved as it was clarified that Mr Sekgitla was not an advisor by a union
representative. At the meeting of 6 November 2015, Mr Healy led the
discussions. There was no agenda, and the information requested was not
provided, most particularly the EOH report. The union reiterated its standpoint
that it is unable to have a meaningful consultation in the absence of the
requested information. The defendant indicated that it would review the
union’s request for the EOH report. The union further suggested suspending
the recruitment process, which the defendant wanted to undertake while
awaiting the outstanding information. The defendant rejected the idea.
[13] Another meeting was scheduled for 9 December 2015. It was in this meeting
that the union learnt for the first time that the defendant had already objected
to the request for the EOH report . The meeting was concluded with the
employer expressing its willingness to set aside time in the coming week to
provide a thorough explanation of the logic behind the restructuring,
referencing the EOH report. The union welcomed the proposal and provided
that the EOH report accompany the intended presentation.
[14] On 10 December 2015, the defendant invited individual employees, calling
them for consultation on 18 December 2015. In Pietermaritzburg, two
employees were called to two separate meetings on 14 December 2015, and
employees were called to two separate meetings on 14 December 2015, and
Mr Healy informed them that the union failed to attend the consultation
meetings. This was not true, as the union attended all the meetings and was
awaiting the defendant's response, as agreed upon in the meeting of 9
December 2015. The defendant selectively dealt with the issue of disclosures.
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There was no selection criterion applied. All engagements with the defendant
on the matter were well -documented and are self -explanatory, indicating that
the defendant failed to comply with section 189 of the Labour Relations Act1.
[15] He maintained that the reason for restructuring was, according to the
defendant, an organi sational review as per the EOH report. They never
emphasised a point of finance. He emphasised that t here is nothing wrong
with an employer embarking on retrenchment due to financial difficulties. In
this matter, they were told about the organisational review, and the defendant
failed to provide information that triggered the organisational review. He was
not aware of the letter s sent to individual employees. He disputed that the
meeting of 16 September 2015 was a consultation. He disputed that the
defendant attempted to consult, but the union impeded it by objecting to the
presence of Tony Healy. In fact, the defendant committed itself on 9
December 2015 to make a presentation and never fulfilled its promise. The
union did not make any input as it was not invited to do so. He disputed that
the meeting of 9 December 2015 was a consultation. The defendant did not
bring what it undertook to provide. The proposal to suspend the recruitment
process was justified.
[16] Avhudzheni Ronald Modzanani was the plaintiff’s third witness and a
gardener based in Ennerdale village for 6 years. There was a meeting
sometime in September 2015. They were not given a reason for the
restructuring. They were told that retrenchment would happen whether they
liked it or not. The last meeting was on 18 December 2015. When they were
told about the defendant’s final decision to retrench. He could not remember
the discussions being translated to him.
The arguments
[17] The defendant argued for the dismissal of the plaintiffs’ case and emphasised
the role of the pre-trial minute, which in this matter did not call upon the Court
the role of the pre-trial minute, which in this matter did not call upon the Court
to decide whether there was a need to retrench. The defendant posted an
alternative argument that there was a need to retrench should its principal
1 Act 66 of 1995, as amended.
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argument not be upheld in this regard, and has complied with the requisite
procedures. Furthermore, the defendant argued that it was entitled to cross -
examine the plaintiff’s witnesses on issues that did not form part of the
evidence tendered by the defendant’s witnesses. The defendant further
argued the impossibility of reinstatement in view of the plaintiffs’ positions no
longer existing in its structures.
[18] The plaintiffs’ argument reiterated its position that the defendant had no
reason to dismiss them , as there was no need to retrench. The decision to
retrench was not effected in accordance with fair procedures. It would be
prejudicial for them if the defendant were allowed to rely on evidence
extracted from the cross -examination of the plaintiff’s witnesses that was not
advanced during the testimony of their witnesses. The plaintiffs are seeking
reinstatement with back pay.
Analysis
[19] It is a settled principle that the dismissal based on operational requirement is
a ‘no-fault’ dismissal. Mr Sekgitla was spot-on that there is nothing wrong with
the employer embarking on a retrenchment process due to financial
difficulties. In this dispute, both the substance and procedure are challenged.
The restructuring forms the core of the reason for dismissal. This certainly
goes into substance. Evidence presented to this Court reveals a dispute over
the origin of the restructuring. The much- talked-about EOH report takes
centre stage. A 55- page document titled ‘Organisational Review of the SOS
Children's Villages’ generated by EOH is, according to the defendant, the
actual EOH report that informed the restructuring. The plaintiff s dispute this,
as the purpose of the document in paragraph 1 reads as follows:
‘SOS Children’s Villages International requires professional services to assist
with an organisational review of one of its National Associations – SOS
Children’s Villages of South Africa.’
Children’s Villages of South Africa.’
[20] The document calls for submission of a proposal from the interested service
providers by no later than 5 pm on 14 November 2015. The defendant relied
on the second part of paragraph 2 of the document, which reads as follows:
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‘In October 2012, the International Senate of the SOS Children’s Villages
International adopted a “Sustainable Path” strategy aimed at stabilising the
Federation’s finances as well as ensuring sustainable growth in the long term.
The Sustainable Path strategy would include reallocation and redirecting
international subsidies to the least developed countries and would also see
the reduction, closure and/or handing over some programmes (non-core/non-
sustainable) as part of a long-term international funding exit programme. 35
countries including SOS Children’s Villages South Africa were identified to
have the potential to increase local income and achieve self -sufficiency status
by 2016. In order to fully achieve this there is need to align the organisation
towards increased fundraising and income growth investment as well as
changes to our programmes and service delivery strategies to more
effectively and efficiently reach targeted programme participants.’
[21] Although the above reveals a plan on how to operate in 2016 in view of the
South African villages standing a good chance of self -sufficiency, the
document's purpose leaned towards calling for proposals to assist with
organisational review. There is no restructuring put forward, or if any, how it
was to be implemented. The defendant relied on the pie charts that were
presented to the plaintiffs and their representatives to suggest that a new
structure had been designed, as nothing appears in the document. The EOH
report that was viewed as a relevant source for the new structure was
promised to the employee representatives, and it never came forth until 6
November 2015, when they were told that the request for the said EOH report
had already been objected to.
[22] The organisational review document does not contain the breakdown of
numbers, which the defendant was canvassing in the meeting, that 54 out of
70 positions existed in the new structure. It should be remembered that the
70 positions existed in the new structure. It should be remembered that the
union was consistent with its request for the report and the reason attached
thereto, which is to make a meaningful contribution in the consultation. The
evidence of Ms Ramela rested heavily on financial difficulties arising out of the
withdrawal of funding by the i nternational funders. However, the defendant ’s
pleaded case is essentially based on restructuring as a catalyst for the
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retrenchment, rather than financial difficulties, and this was further elaborated
upon in the pre-trial minute.
[23] When parties narrowed the issues through the pre-trial process regarding
whether there was a need to retrench, the following was recorded in the pre-
trial minute:
‘The Applicant’s factual basis to deny the need for retrenchment
35. The applicant’s submission:
35.1 The Applicant records that the Respondent’s financial position
was sound at the time of the alleged retrenchment.
The Respondent’s factual basis to admit the need to retrench
36. The Respondent’s submission:
36.1 The Respondent records that the retrenchments were
necessitated by the structural needs and not economic needs.’
[24] The evidence tendered by Ms Ramela in this respect does not support the
pleaded case. It raises a question regarding the real reason for the dismissal
of the plaintiffs based on operational requirements. The absence of the
restructuring content, as stated in the EOH report that was never tabled, has
realistically left the plaintiffs in the dark about the reason for their dismissal.
[25] The agreement on the selection criteria could have probably been reached
had the defendant presented relevant information to enable the plaintiffs to
provide a meaningful contribution. The absence of the agreement on criteria
does not necessarily render the dismissal unfair , as section 189(7)(b)
provides that in the absence of the agreement, the employer must apply the
criteria that are fair and objective. The defendant appeared to have regarded
the recruitment process as a selection criterion, meaning that the affected
employees w ere to apply for vacant positions in the new structure. The
difficulty with this approach is that the defendant had already declared in the
meeting of 9 December 2015 that some employees did not have the skills
required in the vacant positions . That was before they could even apply. By
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construction, they were already excluded from the system before the
retrenchment process could commence. On this note, it cannot be said that
the selection criteria were fair and objective.
[26] The absence of a fair reason for the operational requirement within the
defendant and the lack of evidence that the defendan t applied a selection
criteria that are fair result in the defendant’s failure to demonstrate the
existence of a fair reason for the dismissal of the plaintiffs. Their dismissal is
accordingly substantively unfair.
[27] The provisions for procedures in dismissal based on operational requirements
start at section 189(1)2, which identifies the parties the employer must consult
with. It cannot be disputed that NEHAWU was a trade union with
organisational rights and was accordingly invited to participate in such
consultations. Whilst on bui ld-up for such consultations, specifically through
the meetings held with the trade union on 12 June 2015, 16 September 2015,
06 November 2025, and 9 December 2015, the defendant issued notices to
consult with individual employees, the majority of whom were NEHAWU
members. The last meetings the employer held with individual employees in
exclusion of the union on 14 and 18 December 2015 resulted in the dismissal
of the plaintiffs. This, without any doubt, brings about the defendant’s failure to
comply with section 189(1)(d) of the Labour Relations Act by failing to consult
with the right party for consultation.
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‘(1) When an employer contemplates dismissing one or more employees for reasons
based on the employer’s operational requirements, the employer must consult—
(a) any person whom the employer is required to consult in terms of a collective
agreement;
(b) if there is no collective agreement that requires consultation—
(i) a workplace forum, if the employees likely to be affected by the proposed
dismissals are employed in a workplace in respect of which there is a
workplace forum; and
dismissals are employed in a workplace in respect of which there is a
workplace forum; and
(ii) any registered trade union whose members are likely to be affected by the
proposed dismissals;
(c) if there is no workplace forum in the workplace in which the employees likely to be
affected by the proposed dismissals are employed, any registered trade union whose
members are likely to be affected by the proposed dismissals; or
(d) if there is no such trade union, the employees likely to be affected by the proposed
dismissals or their representatives nominated for that purpose.’
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[28] It has been established from the minutes of the two meetings held with
individual employees that the defendant alleged that the trade union failed to
attend all the consultation meetings.
[29] Based on undisputable evidence before this court, the trade union attended
four meetings, and all were concluded with a consensus that the defendant
would provide information or outstanding information requested by the trade
union in order to make a meaningful contribution during consultation. This
renders the defendant’s assertion that it was always willing to consult , but the
trade union was counterproductive, to be meritless. This, in any event,
appears to be an afterthought in view of the defendant’s persistence in its
pleadings that it has complied with the provisions of section 189 in all
respects. This was repeated in the pre-trial minute.
[30] A claim by the defendant that the m eetings of 16 September 2015 and 9
December 2015 constituted consultation is contradicted by the recorded
purposes of the meetings and the conclusions thereof. Regarding the meeting
of 16 September 2015, the purpose was:
‘To address the concerns as raised by Union Representation regarding
Change process in SOS.
In the absence of an agenda, the meeting is aimed at achieving an
understanding, by the employer, of issues pertaining the change process from
the Union’s side.’
[31] The aims and objectives were recorded as follows:
‘Proper and effective consultation.
From the union side: to make meaningful contributions towards alternatives.
(Union may require certain change process from the Union’s side).’
[32] The conclusion and way forward were recorded as follows:
‘Minutes will be drafted by TM and share with all in the meeting by (date/time
unspecified but agreed to be as soon as possible).
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Employer will respond to the union on points raised and requests made by
(time/date unspecified but agreed to be as soon as possible).
Next meeting will be coordinated by TM and HS by (Time/date unspecified
but agreed to be as soon as possible).’
[33] The meeting of 9 December 2015 appeared not to be structured and the
defendant bemoaned the absence of an agenda. The defendant presented
the figures on the number of vacancies confirmed, amongst others, that the
request for the EOH report was objected to. The meeting was eventually
closed on the understanding that the defendant would set time for the
following week to make a presentation based on the content of the EOH
report. The trade union agreed and impressed upon the defendant to ensure
that the EOH report accompanies the presentation.
[34] No further meeting was held with the trade union after 9 December 2015.
What happened was the dismissal of the employees following the defendant’s
individual invitations to meetings , which the defendant refer red to as
consultation. Based on section 189(1)(d), these meetings with individual
employees cannot constitute consultation, whilst the plaintiffs had NEHAWU
as a consulting party on their behalf. It therefore follows that the defendant
has failed to comply with section 189 of the Labour Relations Act, which
required it to consult with a consulting party on all aspects listed therein. A
finding that the plaintiffs’ dismissal is procedurally unfair is unassailable.
Relief
[35] In view of the finding above, the Plaintiffs are in no doubt entitled to relief. The
plaintiffs are seeking the primary relief of reinstatement. In terms of section
193(2)(d) of the Labour Relations Act, the Court or Arbitrator may not award
reinstatement if it is not reasonably practicable for the employer to reinstate or
re-employ the employee. It is not in dispute that the plaintiffs' positions no
longer exist in the respondent’s structure. This state of affairs is different from
longer exist in the respondent’s structure. This state of affairs is different from
when the positions exist but are occupied by newly hired employees. The
Court has to take note that whichever situation the respondent finds itself in,
came as a result of the implementation of its own decisions, and it has not
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been frank with the employees and the trade union. Clearly, from the
evidence of Mr Sekgitla, there was a chance of finding a solution as the union
approached the engagements with the understanding that it happens a lot that
employers genuinely embark on retrenchment due to financial difficulties. The
defendant, however, took pride in the fact that the retrenchment was not
about finances but restructuring, whilst it was in fact not true.
[36] In view of the plaintiffs’ positions not being available any longer, the Court is
loath to award reinstatement. The most appropriate relief under the
circumstances is compensation. There is no reason militating against the
award of maximum compensation and should accordingly be awarded.
Costs
[37] This Court does not find exceptional circumstances calling for the making of a
cost order. It will therefore be within the requirements of law and fairness that
each party pays its own costs.
[38]
In the premises, the following order is made:
Order
1. The dismissal of the plaintiffs is found to be substantively and
procedurally unfair .
2. The defendant is ordered to pay each plaintiff an equivalent of 12
months' remuneration , calculated at the rate that was applicable at
the time of their dismissal within 14 days of this order .
3. There is no order as to costs .
___________________
MM Baloyi
Acting Judge of the Labour Court of South Africa
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Appearances:
For the Applicant: Adv. K Pooe
Instructed by: Mdluli, Pearce, Mdzikwa and Associates Inc.
For the Third Respondent: Mr M De Villiers of De Villiers & Du Plessis
Attorneys