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[2025] ZALCCT 114
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Kerkdiens (Pty) Ltd t/a Schidhauser Electrical and Plumbing v National Bargaining Council for Electrical Industry of South Africa and Others (C51/2024) [2025] ZALCCT 114 (17 November 2025)
IN THE LABOUR COURT OF
SOUTH AFRICA, CAPE TOWN
Not
Reportable
Case
No: C51/2024
In the matter between:
KERKDIENS (PTY) LTD
t/a
SCHIDHAUSER ELECTRICAL
AND PLUMBING
Applicant
and
THE
NATIONAL BARGAINING COUNCIL FOR
THE
ELECTRICAL INDUSTRY OF SOUTH AFRICA
First Respondent
MICHEAL MARAWU
NO.
Second Respondent
SAKHE PERCIVAL
ZANTSI
Third Respondent
Heard: 1 July 2025
Delivered: This
judgment was handed down electronically by circulation to the
Applicant’s and the First Respondent’s
legal
representatives by email, publication on the Labour Court website and
release to SAFLII. The date and time for handing -
down is deemed to
be 12h00 on 17 November 2024.
JUDGMENT
MAPOMA, AJ
[1]
This
is an opposed review application in terms of section 145,
alternatively section 158(1)(g) of the Labour Relations Act
[1]
(LRA). The applicant, Kerkdiens (Pty) Ltd, trading as Schmidhauser
Electrical and Plumbing (“Kerkdiens”) seeks an order
reviewing and setting aside the arbitration award that was handed
down by the second respondent (“the commissioner”)
on 27
December 2023, under the auspices of the first respondent (“the
bargaining council”).
The Award
[2]
In the impugned award, the commissioner
declared that the third respondent, Sakhe Percival Zantsi (Mr
Zantsi), who was an independent
contractor to the applicant, is
presumed to have been the applicant’s employee for the duration
of his independent contractor
employment relationship with Kerkdiens.
The commissioner further ordered Kerkdiens to register its business,
as well as its employees,
with the bargaining council by no later
than 30 January 2024.
[3]
The main basis of the review is Kerkdiens’
contention that the commissioner committed a reviewable irregularity
as contemplated
in section 145(2)(a)(ii) of the LRA in that the
commissioner failed to have regard to material facts in the
arbitration and therefore
failed to give the applicant a full and
fair hearing in the determination. The consequence, so goes the
argument, is that the commissioner
came to a conclusion that is
unreasonable.
[4]
The application is opposed by the
bargaining council. The latter contends that the commissioner did not
commit any reviewable irregularity
and thus the award is unassailable
based on the correctness test. The dispute arises from the background
facts set out in the ensuing
paragraphs.
The Background
[5]
On 18 May 2021, Zantsi concluded a service
provider agreement with Kerkdiens, in terms of which he agreed to
provide certain electrical
services to Kerkdiens as an independent
contractor and thus a service provider to Kerdiens.
[6]
Clause 3.3 of the service provider
agreement provides as follows:
‘
3.3
The service provider shall be rendering services for and on behalf of
the Company as an independent
contractor. The appointment of the
service provider in terms of this agreement, and this agreement
itself, shall not be construed
in any way to:
3.3.1
constituents an employer/employee, agency, joint venture or
partnership agreement in any shape or form between
the parties;
and/or
3.3.2 …
3.3.3 …
3.4
The service provider acknowledges that it has no right to or
expectation of any employment,
further contact with, or appointment
by, the company.’
[7]
On 22 September 2023, Kerkdiens terminated
the service provider agreement with Zantsi and paid him what was due
for the services
he rendered up until the termination of the
agreement.
[8]
Aggrieved by Kerkdien’s termination
of the service provider agreement, Zantsi referred a dispute of
unfair dismissal to the
Commission for Conciliation, Mediation and
Arbitration (CCMA). In his referral form, Zantsi raised the issue
that Kerkdiens was
not registered with the bargaining council as
contemplated in the collective agreement with the bargaining council.
[9]
At the CCMA, Kerkdiens took a
jurisdictional point, challenging the jurisdiction of the CCMA to
determine the matter, contending
that Zantsi was not an employee but
rather an independent contractor providing electrical services to
Kerkdiens based on the service
provider agreement that was concluded
between the two parties governing their employment relationship.
[10]
On 16 November 2023, the CCMA issued a
directive in terms of section 147 of the LRA, where it pronounced
that, because the applicant
operates a business of electric services,
the applicant falls under the registered scope of the bargaining
council. The CCMA accordingly
stayed its proceedings and referred the
dispute to the bargaining council in terms of section 147(2)(a)(i)
for resolution by the
bargaining council.
[11]
On 26 October 2023, the bargaining council
issued a compliance order, seeking to enforce its collective
agreement in terms of section
33A of the LRA. In pursuit of its
enforcement, the bargaining council called Kerkdiens to an
arbitration hearing, alleging that
Kerkdiens was contravening its
main collective agreement insofar as it relates to Zantsi.
[12]
At the arbitration, the commissioner, in
his characterisation of the dispute, identified the issue for
determination as turning
on whether Zantsi was an employee, or
whether he was an independent contractor of Kerkdiens. The
commissioner considered the opening
addresses of the parties’
legal representatives for the parties without hearing any evidence,
be it from Zantsi or Kerkdiens.
The commissioner made the
determination based on the legal submissions made by the parties
during their opening addresses.
[13]
Upon his assessment of what he considered
to be the common cause facts and the proven facts in the dispute, the
commissioner concluded
that Zantsi’s real employment
relationship with Kerkdiens was such that Zantsi was an employee of
Kerkdiens. In this regard,
the commissioner reasoned that it was
uncontested that Zantsi operated as an employee of Kerkdiens.
According to the commissioner,
Kerkdiens’ selected challenge
was largely about the intricacies of section 200B of the LRA and that
it only sought to exclusively
argue that it was not the employer,
without dealing with the provisions of section 200A and 213 of the
LRA.
[14]
The
commissioner further reasoned that it was common cause that in their
employment relationship the parties engaged each other
in the manner
consistent with at least up to six listed factors contemplated in
section 200A(1) of the LRA to qualify Zantsi as
presumed employee,
and that Zantsi was earning below the threshold set out in the Basic
Conditions of Employment Act.
[2]
[15]
The commissioner also took the view that
Kerkdiens did not seek to deny that Zantsi met most of the factors
listed in section 200A(1)
of the LRA, which make Zantsi presumed to
be an employee regardless of the nature of the employment
relationship. The commissioner
further found that it was uncontested
that Zantsi had operated as the employee of Kerkdiens.
[16]
In essence, Kerkdiens’ case is that
the commissioner committed a reviewable irregularity as envisaged in
section 145(2)(a)(i)
and (ii) of the LRA when he reasoned that Zantsi
was an employee of Kerkdiens, the latter operating within the scope
of the industry
covered by the bargaining council, placing reliance
on what he claimed to be common cause facts and proven facts whereas
such facts
were in dispute and not proven by evidence.
[17]
According to Kerkdiens, the issue for
determination as to whether Zantsi was an employee, as claimed by the
bargaining council,
or an independent contractor, as claimed by
Kerkdiens, required a factual determination. According to Kerkdiens,
contrary to what
the commissioner found, there were no common cause
facts between the parties which could have been used to resolve the
dispute
between them. Also, there were likewise no proven facts, as
claimed by the commissioner.
[18]
Kerkdien’s further contention is
that, despite being requested to allow the parties to lead evidence,
the commissioner did
not afford them that opportunity. Consequently,
all the parties, including Zantsi, were not afforded that opportunity
to lead any
evidence to prove their contentions.
Review Test
[19]
The bargaining council argues that the
issue as to whether Zantsi was an employee is a jurisdictional fact,
in that, in the absence
of an employment relationship between
Kerkdiens and Zantsi, the bargaining council lacked jurisdiction to
determine the matter.
The council argued that, because the
arbitration was about the determination of jurisdictional fact, the
proper review test to
be applied is the correctness test, to
determine whether the commissioner was right or wrong in his award,
instead of the reasonableness
review test.
[20]
Further, the bargaining council case has
taken a somewhat different slant, in that it argues that the court
should decide the matter
based on consideration of the entire record,
including documentary evidence
de novo
to determine whether the commissioner was right or wrong. In so
doing, so goes the argument, the Court should, on its own accord,
determine the existence of the employment relationship.
[21]
The
generally accepted view is that in review proceedings we have a
bifurcated review standard, namely, a reasonableness and correctness
test. The issue in dispute determines the review test to be applied,
and as such, it is important to identify the issue in dispute,
which
will determine which review test to be harnessed in order to resolve
the dispute.
[3]
Where the court
is required to analyse the objective facts to determine whether the
bargaining council had jurisdiction, the correctness
test is
applicable.
[4]
[22]
However, the above cannot be said in a case
where the errors of facts are at issue. In the present case, while on
the face of it,
one might argue that the dispute was a determination
of a jurisdictional point, the real issue for determination to
establish jurisdiction
lied on the disputed facts that were highly
contentious, namely, whether Zantsi was an employee or not. In this
case, that issue
was not based on objective facts, but required
rigorous scrutiny to establish the disputed facts. It is therefore my
view that
the correctness test is not an appropriate test to be
applied in this case.
[23]
Moreover,
it is trite that the role of the review court is limited to deciding
issues that are raised by the party who seeks to
review the arbitral
award in the review proceedings. The court may not, on its own
accord, raise issues which are not raised by
a party seeking to
review the arbitral award.
[5]
[24]
In
this case, the review application was launched in terms of Section
145(2) of the LRA. The main review ground raised by the applicant
is
that the commissioner committed gross irregularity as contemplated in
section 145(2)(a)(i) and (ii) of the LRA, in that the
commissioner
failed to properly consider the real issue by determining the
material facts. The Constitutional Court in
Sidumo
and Another v Rustenburg Platinum Mines Ltd and Others,
[6]
held that section 145 of the LRA is suffused in reasonableness, and
that the threshold for reasonableness of the award is whether
the
decision reached by the commissioner was one that which a reasonable
decision maker could not have reached. It is my view that
the
reasonableness test is the appropriate test applicable in this case.
[25]
In
light of the grounds of review mentioned above, the central issue for
determination is whether the arbitrator, in his reasoning
and in
arriving at his decision, committed gross irregularity complained of
that rendered the award reviewable. Based on the postulated
review
grounds, the question to be determined is whether the arbitrator
properly considered the principal issue before him by properly
evaluating the essential facts and correctly applied the relevant
legal principles to the facts in arriving at the award.
[7]
[26]
In
determining whether a reviewable irregularity has occurred, the
general rule is that the crucial question is whether the conduct
of
the commissioner prevented a fair trial of the issues. If it did
prevent a fair trial of the issues, then it will amount to
gross
irregularity.
[8]
It then follows
that the decision is one that a reasonable decision maker could not
have reached.
[27]
Gross
irregularity as a ground of review derives its strength from section
33(1) of the Constitution,
[9]
which guarantees everyone the right to administrative action that is
lawful, reasonable, and procedurally fair. Since an arbitral
award
constitutes an administrative action, the Constitution requires it to
be procedurally fair, lawful and reasonable. This means
that, an
award that fails to meet these requirements is liable to be set aside
on review.
[10]
[28]
When
a commissioner commits a procedural irregularity, the award would be
set aside on review if it results in the aggrieved party
not having
its case fully and fairly determined.
[11]
Once the applicant for review establishes a material act of
procedural unfairness, that alone is sufficient to sustain a review
without it being necessary to also assail the substantive
reasonableness of the outcome of the award.
[12]
[29]
In this case, the commissioner determined
the issue by his interpretation of the provisions of 200A of the LRA.
Section 200A of
the LRA creates a statutory rebuttable presumption
that certain categories of workers are to be presumed to be
employees. The section
reads as follows:
‘
200A.
Presumption as to who is employee
(1)
Until the contrary is proved, for the purpose of this Act, any
employment law and
section 98A of the Insolvency Act, 1936 (Act 24 of
1936), a person who works for, or renders services to, any other
person is presumed,
regardless of the form of the contract, to be an
employee, if any one or more of the following factors are present—
(a)
the manner in which the person works is subject to the control or
direction of another
person;
(b)
the person’s hours of work are subject to the control or
direction of another
person;
(c)
in the case of a person who works for an organisation, the person
forms part of that
organisation;
(d)
the person has worked for that other person for an average of at
least 40 hours per
month over the last three months;
(e)
the person is economically dependent on the other person for whom he
or she works
or renders services;
(f)
the person is provided with tools of trade or work equipment by the
other person;
or
(g)
the person only works for or renders services to one person.’
[30]
The commissioner purported to apply the
presumption of employee status contained in section 200A to what he
alone considered to
be common cause facts and proven facts, which,
according to him, established the existence of the listed factors in
section 200A.
On this basis, the commissioner arrived at the
conclusion that Kerkdiens was the presumed employer of Zantsi.
Importantly, the
applicant contends that the facts the commissioner
claimed as common cause were, in fact, the very issues in dispute and
required
rigorous scrutiny through the establishment of facts.
[31]
There is no evidence that what the
commissioner claimed to be common cause facts were, in fact, common
cause facts between the parties.
What is before the Court is a
contention that what was claimed to be common cause facts were
contentious issues. These are the
very issues that had to be
determined by evidence for them to be regarded as established facts.
In the circumstances, the Court
finds that it was grossly irregular
for the commissioner to hold that the disputed facts are common cause
facts, more so without
hearing evidence despite request from the
parties to be allowed to do lead evidence. The opening addresses, as
gleaned from the
record, do not reveal any proven facts or common
cause facts.
[32]
The provisions of section 200A of the LRA
create a rebuttable presumption of employee status. The fact that the
listed factors in
section 200A exist creates only a presumption that
is open for rebuttal by the contesting party. It does not by itself
mean that
Zantsi was proved to be an employee without affording
Kerkdiens an opportunity to rebut the presumption, particularly in
circumstances
where Kerkdien disputed the employee status of Zantsi.
[33]
In my view, the words “
until
the contrary is proved”
mean that
section 200A(1) entitled Kerkdiens with a right to prove when the
dispute was arbitrated on merits that Zantsi was not
its employee.
Section 200A thus left the door open for the applicant to prove the
contrary, and in so doing, it is not inconceivable
that there is an
evidential burden to the applicant, as the party contesting the
presumed employee status, to prove the contrary.
Equally, the
commissioner is enjoined to determine whether the contrary had been
proved and thereafter make a pronouncement on
whether Kerkdiens was
the employer of Zantsi.
[34]
Kerkdiens contends that, while it was open
for it to prove the contrary as envisaged in section 200A, the
commissioner did not allow
the parties to lead evidence to that
effect, despite a request to do so. The commissioner made the
decision, based on the presumption,
that Kerkdiens was the employer
and issued the award on that basis.
[35]
In my view, even if the commissioner
pronounced that the applicant was presumed to be the employer, that
is not the end of the matter.
Section 200A of the LRA permits the
bargaining council to afford the applicant a right to put up a case
to rebut the presumption
of employment. On the facts before the
Court, it seems that such an opportunity was not afforded to the
applicant despite its request
to the commissioner to do so. Nothing
can be more irregular in the circumstances.
[36]
Allowing the parties to lead evidence would
have enabled the commissioner to bring impartiality to bear by,
first, affording the
applicant opportunity to rebut the presumption,
and second, affording the parties a full and fair hearing and thereby
determining
through established facts the real relationship between
the Kerkdiens and Zantsi. It would be at this stage that the
commissioner
would be in a fair position to find common cause and
proven facts. Accordingly, failure on the part of the commissioner to
allow
the parties to lead evidence in the circumstances of this case
to enable him to establish the disputed facts constitutes a
reviewable
irregularity.
[37]
The Court is mindful that section 138 of
the LRA gives the commissioner the authority, in his discretion, to
conduct arbitration
proceedings in a manner he considers appropriate,
with minimal legal formalities, to ensure fair and swift
determination of disputes.
However, the commissioner is duty bound to
exercise this discretion judicially. Importantly, the discretion
endowed to the commissioner
by section 138 of the LRA does not
preclude the constitutional obligation on the part of the
commissioner to observe the rules
of natural justice. These rules
include the
audi alteram partem
rule which bestows a right to be heard. In this case, the Court finds
that the case of the applicant was not fully and fairly heard
as it
should have been.
[38]
In conclusion, having considered the issues
in this matter, the Court is satisfied that the applicant has
established valid grounds
to have the award reviewed and set aside.
Accordingly, the review applicant must succeed.
[39]
In the premises, the following order is
made:
Order
1.
The arbitration award is reviewed and set
aside.
2.
There is no order as to costs
Z.L Mapoma
Acting Judge of the
Labour Court
Appearances:
Counsel for the
Appellant:
Adv B Joseph SC
Instructed
by:
BDP Attorneys, Cape Town
Counsel for the
Respondent: Mr X
Wehncke
Instructed
by:
Wehncke Parsons Incorporated, Cape Town
[1]
Act
66 of 1995, as amended.
[2]
Act 75 of 1997.
[3]
Jonsson
Uniform Solutions (Pty) Ltd v Brown and Others
(DA10/2012) [2014] ZALCJHB 32 (13 February 2014) at paras 33 to 36.
[4]
S
outh
African Rugby Players Association (SAPRA) and Others v SA Rugby
(Pty) Limited and Others; SA Rugby Pty Limited v South African
Rugby
Players Union and Another
(CA
10/2005)
[2008] ZALAC 5
(12 May 2008).
[5]
Commercial
Workers Union of SA v Tao Ying Metal Industries & others
(2008) 29 ILJ 2461 (CC) at para 67.
[6]
2008
(2) SA 24 (CC).
[7]
Gold
Fields Mining SA (Pty) Ltd (Kloof Gold Mine) v Commission for
Conciliation, Mediation & Arbitration & others
(2014) 35 ILJ 943 (LAC) at paras 16 - 18.
[8]
Goldfields
Investments and Another v The City of Johannesburg and Another
1938 TPD 551
– 560, cited with approval in
Toyota
SA Motors (Pty) Ltd v Commission for Conciliation, Mediation and
Arbitration and others
[2016] 3 BLLR 217
(CC) at para 101.
[9]
The
Constitution of the Republic of South Africa, 1996.
[10]
Duncanmec
(Pty) Ltd v Gaylard NO and Others
2018 (6) SA 335
(CC) at para 40.
[11]
Myburgh
‘et al’, Review in the Labour Courts, 2016;
Toyota
SA Motors (Pty) Ltd v Commission for Conciliation, Mediation and
Arbitration and others
[2016] 3 BLLR 217
(CC) para 105.
[12]
Myburgh, ibid.