IN THE LABOUR COURT OF SOUTH AFRICA
HELD AT JOHANNESBURG
Case No: J 361/98
In the matter between
MARIA DORETHEA DE BRUIN
Applicant
and
SUNNYSIDE LOCKSMITH SUPPLIERS (PTY) LTD
Respondent
___________________________________________________________
_____
JUDGMENT
___________________________________________________________
_____
VAN NIEKERK A J
Introduction
1 On 1 July 1997, during her lunch hour, Maria de Bruin, the Applicant in this
matter, slipped and fell on the corner of Eloff and Harries Streets,
Johannesburg. She broke her leg in two places. This event was to impact
profoundly not only on her health, but also on her employment. It is
common cause that on 15 August 1997, while she was at home recovering
from a series of operations undergone as a consequence of her accident,
De Bruin received a letter from her employer advising her that during her
absence from work it had been established that her position had become
redundant. She was further advised that her services were accordingly no
longer required, and she was given two weeks' notice of the company's
intention to terminate her employment.
2 De Bruin claimed that her dismissal was unfair. In the absence of a
successful conciliation by the CCMA, the dispute was referred to this Court
for adjudication.
3 During the course of the proceedings, it was conceded on De Bruin's
behalf that her dismissal was substantively fair. The only issue that
remains in dispute therefore is whether De Bruin's dismissal was effected
in accordance with a fair procedure as required by section 189 of the
Labour Relations Act, 66 of 1995 and if not, the remedy to which she is
entitled.
The facts
4 The Company is engaged in the distribution of locks, keyblanks and
locksmith tools. It is a small business. It is also in dire financial straits.
The undisputed evidence of Mr. Gerald Mindel, the Managing Director,
was that during 1997 the Company's financial position began to
deteriorate, and that the Company is currently struggling to survive. It was
also undisputed that during the course of last year, Mindel had taken a pay
cut of 50%, that other monthly paid employees had taken a pay cut of
20%, and weekly paid employees a cut of 10%.
5 It is also common cause that the company employed De Bruin on
8 February 1995. At the time of her dismissal therefore, she had been
employed for some 30 months. She was initially engaged to conduct
telesales on a halfday basis. At the time of her accident, she was
engaged on what was termed the "front desk", on a full day basis. At that
stage, she earned R3 300,00 per month.
6 It is common cause that immediately after her accident on 1 July 1997,
De Bruin was admitted to hospital, and that she underwent an operation on
2 July 1997.
7 De Bruin testified that on 3 July 1997, she telephoned the receptionist, Ms
Leona Jordaan, to advise her of her condition. De Bruin says that she
requested Jordaan to tell Mindel that she had been hospitalised.
8 At some stage before 20 July 1997, De Bruin says that she telephoned
Mindel on his cell phone, and that Mrs. Mindel answered. De Bruin says
that they had a conversation about Mindel's state of health (she had heard
that he was ill) and her own. She says that she advised Mrs. Mindel of the
fact that she was about to undergo a second operation, and that she
requested Mrs. Mindel to advise Mindel that she had telephoned.
Mrs. Mindel gave evidence for the Company. She denied that the
conversation took place.
9 De Bruin underwent a second operation on 20 July 1997. During the latter
half of July, while she was recuperating at home, De Bruin says that she
had further contact with the office in the form of work brought to her by the
company driver. The work comprised the alphabetical filing of invoices,
which De Bruin says that she did at home. This is disputed by Zizi
Landolt, the Company's bookkeeper, who testified that it was not policy to
permit documents to leave the company's premises.
10 Mindel testified that in early August 1997, he became concerned about
De Bruin's continued absence from work. He had received no reports of
her condition beyond the initial report of her accident, and a report that she
had been discharged from hospital. He said that on 6 August 1997, he
requested Landolt to address a letter to De Bruin.
11 Landolt gave evidence that she typed and signed the letter on 6 August
and that she instructed the company driver to deliver it to De Bruin's home.
The letter reads as follows:
“Dear Maria,
It has been well over a month since we have had any word from you.
Please let us know if you are returning to work and if so when we can
expect your return as we are unable to keep your position open
indefinitely.
Kind regards
Zizi Landolt.”
12 Mindel gave evidence to the effect that during De Bruin's absence, he had
observed that other employees were sufficiently capable of doing the work
normally undertaken by her. His purpose in instructing Landolt to address
the letter to De Bruin was twofold. First, he wished to establish whether
she intended returning to work, and secondly, he wished to convey to her
that the security of her employment was in some doubt. He stated that he
was aware of an obligation to negotiate prior to retrenching an employee
and in his view, the letter had served to initiate a discussion with her. He
conceded that the letter was unfortunately worded, and that it did not
convey his intention as precisely as it could have.
13 There is some doubt as to whether the letter was delivered on 6 or
7 August 1997, but that is not particularly material for present purposes.
De Bruin testified that she received the letter of 6 August 1997. She was
sufficiently shocked after reading the letter to request her husband to take
her, in a wheel chair, to the nearest public telephone. She says that she
spoke to Landolt and asked her why she had sent the letter. According to
De Bruin, Landolt replied that she (De Bruin) was wasting the company’s
time and that she had nothing further to say.
14 De Bruin testified that she was upset at the content and tone of the letter,
and at Landolt's response. As far as she was concerned, she had kept the
company advised of her condition. She requested her husband to go to
the company's premises to see Landolt on her behalf.
15 What transpired between Mr. de Bruin and Landolt is disputed. Mr. de
Bruin testified that early on the morning of 6 August, he reported at the
Traffic Department where he worked, and then caught a bus to the
Brenthust Clinic where he obtained a medical certificate before catching a
bus home. His evidence was that he and his wife had decided the previous
day to obtain a further medical certificate from the medical practitioner
attending to De Bruin. After his arrival at home, the letter signed by Landolt
was delivered. After the telephone call was made by his wife and their
agreement that he would intervene on her behalf, he again caught a bus
into the city to go and see Landolt, which he did shortly after 08:00.
16 When he arrived at the company's office, he asked to speak to Landolt. He
says that he advised her that De Bruin had notified the company of her
condition, and that the letter was unfair. He testified that Landolt then
started swearing at him, and that he advised her that the company could
not treat De Bruin the way it had. He left the medical certificate with
Landolt and left the premises.
17 Landolt's version of her encounter with Mr. de Bruin is very different. She
testified that on the morning of 7 August 1997 Mr. de Bruin arrived at the
company's premises, in uniform, and in an abusive and threatening way,
told her that he and his wife had taken advice, that they would sue the
company and that were it not for the fact that she was a woman, he would
have "sorted her out". Landolt says that Mr. de Bruin's conduct was such
that she requested two colleagues to escort Mr. de Bruin from the
premises, which they did. She reported the matter to Mindel, who was in
Durban at the time of the incident, and to the Traffic Department, Mr. de
Bruin's employer.
18 Mindel testified that on his return to the office on Monday 11 August 1997,
he received a report from Landolt regarding Mr. de Bruin's visit, and that
he was particularly concerned by what he heard. He formed the view that
in the circumstances, and in the light of previous encounters with Mr. de
Bruin, he could not continue to deal with De Bruin, and that there was no
merit in any further discussion with her on the matter of her employment.
He therefore abandoned his intention, conveyed in the letter of 6 August,
of a discussion with De Bruin, and decided to terminate her employment.
After advice was sought from the Department of Labour, he gave
instructions for a letter to be addressed to De Bruin. The letter reads as
follows :
"Dear Maria
I was away last week when your husband came into the office in
response to a letter that Zizi Landolt had sent to you at my request.
I understand that your husband was extremely abusive to Zizi and
threatened her with physical reprisals and had to be forcibly restrained and
removed from our premises by members of staff.
I further understand that complaints concerning your husbands actions
have been registered both with the Johannesburg Traffic Department and
the Department of Manpower.
You have been away from work for almost 6 weeks now and we have
discovered that your position in the firm has become irrelevant. We have,
therefore, decided to do away with the position you previously occupied
and that your services will no longer be required.
We are, therefore, giving you two weeks notice effective today.
We are enclosing a cheque in the sum of R3 466,98 made up as
follows :
2 weeks notice pay @ R761,54/week R1523,08
7.5 days leave pay @ R152,31/day R1142,33
5 weeks pay as compensation for your retrenchment R3807,70
________
R6473,11
________
less overpaid on sick leave due 13 days
R1980,03
less PAYE
R1026,10
_____
___
Total payment due : R3466,98
We are sorry that this situation has arisen and we wish you a speedy
recovery."
19 De Bruin testified that on 15 August 1997 she was at home in bed, when a
representative employed by the company delivered the above letter.
Findings
20 In regard to the disputes concerning communication between De Bruin and
the Company, I accept that De Bruin was of the view that she had
discharged any obligation she had to notify the Company of her injury and
consequent incapacity. I accept too Mindel's evidence that no medical
certificates relating to the seriousness of De Bruin's injury or her prognosis
were ever brought to his attention. It is probable that De Bruin placed her
faith in Jordaan as a conduit to senior management but that for some
reason, reports of De Bruin's circumstances were never communicated to
Mindel.
21 Little turns on the matter of the communications between De Bruin and the
Mindels, or on the dispute about the frequency with which these
communication were made, or with which medical certificates were
furnished. The only factual dispute of any consequence relates to events
surrounding Mr. de Bruin's visit to the Company's premises after delivery
of the letter dated 6 August 1997. In this regard, I accept Landolt's
version of events. Mr. de Bruin was not a satisfactory witness. He was
clearly confused about the dates and times of events that culminated in the
altercation between him and Landolt. His version of events that he says
took place on the early morning of 6 August is improbable. He conceded
as much during crossexamination. The crux of this dispute is the effect, if
any, of the altercation on the company's obligations in terms of section 189
of the LRA. In this regard, Mindel's evidence is crucial. On his own
evidence, he had reached a conclusion that went beyond the point of
contemplation of dismissal when he directed Landolt to address the letter
of 6 August 1997. He also failed to consult on any of the matters referred
to above.
22 Section 189 requires an employer that contemplates terminating the
employment of one or more of its employees for reasons relating to its
operational requirements, to consult the appropriate parties in an attempt
to reach consensus on measures to avoid the dismissals to minimise
them, the change the timing of the dismissals and to mitigate their adverse
effect. Consultation is also required on the methods for selecting those
employees whose employment is to be terminated, and on the severance
pay that will be paid to them.
23 The Company's defence is that given the events surrounding the
altercation between Landolt and Mr. de Bruin, the Company should be
excused from any failure to comply with the requirements of section 189.
24 Mr. Landman, who appeared for the company, submitted that Mindel was
reasonably entitled to assume that any further dealings with the either of
the De Bruins would have been fruitless, and that Mindel was entitled in
those circumstances to terminate De Bruin's employment in the manner he
did.
25 The Labour Appeal Court recently affirmed the principled and pragmatic
rationale for the need to consult before a final decision on retrenchment is
taken. (See S A Clothing & Textile Workers Union & Others v Discreto A
division of Trump & Springbok Holdings (1998) 19 ILJ 1451 at 154 E to H.
26 It is now well established that section 189 places some primary obligations
on an employer in order to ensure that an employee is not unfairly
dismissed. These have as their principal purpose a joint consensus
seeking approach. On this basis, a mechanical approach to section 189
has been held to be inappropriate, the correct approach is to ascertain
whether the purpose of the section has been achieved. If the purpose has
not been achieved, the reason must be established and the Court must
determine whether there is any fault to be attributed to the parties. (see
Johnson and Johnson (Pty) Ltd v CWIU [1998} 12 BLLR 1209 (LAC), at
1216). The starting point, however, is section 189. The Labour Appeal
Court has observed that the provisions of that section are inextricably
linked to the fairness of a dismissal for operational requirements, and that
a finding of noncompliance will invariably result in the dismissal being
unfair for want of compliance with a proper procedure. Mindel was an
impressive witness. I accept that subjectively, he considered that further
dealings with the De Bruins would have been fruitless. But the test of
compliance with section 189 is not subjective. Mr. Rossouw argued,
correctly in my view, that Mindel could have continued the process of
consultation and ensured compliance with section 189 by telephone, or by
correspondence, if a meeting was impossible or inappropriate on account
of the strained relationship that had been created by Mr. de Bruin's
intervention. He failed to do so. I have no hesitation in concluding that the
Company dismissed De Bruin without following a fair procedure.
Compensation
27 The final issue that remains to be determined is an appropriate remedy.
De Bruin has elected to waive the primary remedies of reinstatement and
reemployment. She seeks an award of compensation. The principles
regulating an award of compensation are discussed in the Johnson and
Johnson judgment.
28 The starting point is section 194 of the LRA. That section provides:
"(1) If a dismissal is unfair only because the employer did not follow
a fair procedure, compensation must be equal to the remuneration that the
employee would have been paid between the date of dismissal and the
last day of the hearing of the arbitration or the adjudication, as the case
may be, calculated at the employee’s rate of remuneration on the date of
dismissal. Compensation may however not be awarded in respect of any
unreasonable period of delay that was caused by the employee in initiating
or prosecuting a claim.
(2) The compensation awarded to an employee whose dismissal is
found to be unfair because the employer did not prove that the reason for
dismissal was a fair reason related to the employee’s conduct, capacity or
based on the employer’s operational requirements, must be just and
equitable in all the circumstances, but not less than the amount specified
in subsection (1), and not more than the equivalent of 12 months’
remuneration calculated at the employee’s rate of remuneration on the
date of dismissal.
(3) The compensation awarded to an employee whose dismissal is
automatically unfair must be just and equitable in all the circumstances,
but not more than the equivalent of 24 months’ remuneration calculated at
the employee’s rate of remuneration on the date of dismissal.
29 The rigidities in section 194 have been the subject of criticism by this
Court. In Chantel Annie du Toit v Sasko (Pty) Ltd (Case No. J1115/97)
Mlambo J stated
"He (referring to the legal representative for the respondent) has further
argued that the interpretation presently accorded to this section by the
LAC leads to absurd and repugnant consequences. This argument
commends itself to me especially the fact that the size of the
compensation awarded depends on how long it takes the adjudicative and
compensation awarded depends on how long it takes the adjudicative and
arbitral process to finalise the matter. The case load of the relevant forum
determines the amount awarded at the end of the day. This appears to
have, at least for employers, absurd consequences. In my view this result
cannot be ruled out entirely and it is perhaps advisable that this issue be
revisited by our betters in the Labour Appeal Court. "
30 In Vickers v Aquahydro Projects (case number D424/97) Maserumule AJ
stated
"Sections 194(1) and (2) obviously require amendment to remove the
apparent ambiguity. Until this is done, the Court is required to interpret the
Act in a manner consistent with its purpose".
31 The provisions of section 194 were drafted with some obvious
assumptions about the expeditiousness of the new statutory dispute
resolution mechanisms in mind. This much is obvious from the Explanatory
Memorandum published with the Draft Bill. (See 1995 ILJ 278 at 320,
where it is envisaged that disputes would be resolved within weeks; a
fundamental assumption made in regard to the statutory formula for
compensation in procedurally unfair dismissals). In the Vickers case,
Maserumule AJ went on to hold that it was not the legislature's intention to
afford an employee whose dismissal is unfair only because of unfair
procedure more compensation than an employee whose dismissal was
without a valid reason. On this basis, he concluded that the limit of 12
months compensation in section 194(2) applies equally to compensation
payable in terms of subsection (2). In the Whall v Brandadd Marketing
(Pty) Ltd case, the same approach was adopted. Although De Bruin was
dismissed almost 18 months prior to the last day of the hearing of this
matter, on the basis of the above authorities, the maximum compensation
to which De Bruin is entitled is the equivalent of 12 months remuneration. I
did not understand either counsel to dispute this interpretation of section
194(1).
32 Having determined the maximum to which De Bruin is entitled, it remains
to consider whether the Court has any discretion to order any lesser
amount. In the Johnson & Johnson decision, the Labour Appeal Court
summarised the position as follows:
" If a dismissal is found to be unfair solely for want of compliance with a
proper procedure the Labour Court, or an arbitrator appointed under the
LRA, thus has a discretion whether to award compensation or not. If
compensation is awarded it must be in accordance with the formula set
out in s.194(1); nothing more, nothing less. The discretion not to award
compensation in particular cases must, of course, be exercised judicially.”
33 The Labour Appeal Court provides at least two examples of what might
constitute a basis for a refusal to grant compensation. At 1220D of the
report the Court adds that:
“The nature of an employee’s right to compensation under s.194(1)
also implies that the discretion not to award that compensation may be
exercised in circumstances where the employer has already provided the
employee with substantially the same kind of redress (always taking into
account the provisions of s.194 (1)), or where the employer’s ability and
willingness to make that redress is frustrated by the conduct of the
employee.”
In the Brandadd Marketing case, Grogan AJ applied the approach adopted
in the Johnson and Johnson case, but considered a number of other
factors that may be relevant to the exercise of a discretion to refuse an
award of compensation, utilising as a point of departure a comparison
between the statutory minimum and the amount that the applicants would
have received in the absence of a statutory constraint. In this instance, in
the absence of the constraints imposed by section 194(1), the approach
that would have been adopted is that applied by the Labour Appeal Court
in S A Clothing & Textile Workers Union & Others v Discreto A Division
of Trump & Springbok Holdings (1998) 19 ILJ 1451 (LAC). In that case
the Court considered that the "practical (and flexible) yardstick" to
determine the appropriate amount of compensation would be the
employee's salary for the length of time a normal process of consultation
would have taken. Having regard to the size of the Company and the
nature of its business and the fact that the Company was obliged only to
consult with a single employee, it is fair to assume that a process of
consultation in compliance with section 189 would have taken a month or
so to complete.
34 The letter addressed to De Bruin on 15 August 1997 records certain
amounts paid to her. Included in these is an amount of R3807,00,
described in the letter as " compensation for your retrenchment ". During
argument, Mr. Rossouw agreed that this amount constituted compensation
in the form envisaged by section 194, and not severance pay payable in
terms of section 196, and that it could therefore be taken into account for
the purposes of calculating any compensation to which De Bruin may be
entitled.
35 I am of the view that the degree of unfairness in relation to the Company's
conduct is not such that an award of the equivalent of 12 months
remuneration is warranted. The company has paid an amount equivalent
to 5 weeks remuneration in compensation, and that in my view is a fair and
adequate sum to compensate De Bruin in the circumstances of this case.
In the words of the formula in Johnson & Johnson, sufficient redress has
already been made. Furthermore, the process of consultation was to some
extent frustrated by the Applicant. Although this was insufficient to warrant
a finding that De Bruin's dismissal was procedurally fair, I am entitled to
take into account for the purpose of exercising a discretion concerning
compensation the fact that Mr. de Bruin, who was authorised to act and
who acted on De Bruin's behalf, conducted himself in a manner that was
not conducive to constructive consultation. A degree of blame can
therefore be attributed to the Applicant for the failure of the consultation
process, and for the failure of the purpose underlying section 189. In all
the circumstances, I exercise the discretion conferred on me by section
194(1) not to award compensation to De Bruin.
Severance pay
36 Section 196(1) requires an employer to pay an employee dismissed for
reasons based on the employer's operational requirements severance pay
equal to at least one week's remuneration for each completed year of
service with that employer. It is common cause that De Bruin was not paid
severance pay at the time of her dismissal. She is therefore entitled to the
equivalent of two weeks' remuneration.
Costs
37 This is not a case where on ongoing relationship should deprive a successful
party of costs. De Bruin has succeeded in establishing that her dismissal was
procedurally unfair, and I see no reason to deprive her of her costs. I would
note however that her representative until the commencement of the
proceedings was the Sebenza Labour Consultancy. Labour consultants have
no right of appearance in this court and are not entitled to recover costs. Mr.
Rossouw, who trades as Sebenza Labour Consultancy, appeared in these
proceedings in his capacity as an advocate of the High Court. He satisfied the
Court that he was instructed to appear in that capacity. The attorney who
instructed Mr. Rossouw appeared to play no part in the proceedings beyond
signing the brief cover. In these circumstances, and I did not understand Mr.
Rossouw to disagree, the costs to which De Bruin is entitled are limited to the
costs of appearance by counsel for the two days of the hearing.
38 I accordingly make the following order :
38.1 The dismissal of the Applicant was procedurally unfair.
38.2. The Respondent is ordered to pay the Applicant's severance pay in an amount
equivalent to two weeks' remuneration, to be calculated on the basis of the
remuneration paid to her on the date of her dismissal, i.e. R3 300,00 per
month.
38.3. The Respondent is ordered to pay the Applicant's costs, such costs to be limited to
the fees of an appearance in trial proceedings by one advocate, for two
days, on a party and party basis.
_________________________
ANDRE VAN NIEKERK
Acting Judge of the Labour Court
SIGNED AT JOHANNESBURG AND DATED ON THIS THE 19TH DAY
OF APRIL 1999
DATE OF HEARING 18 & 19 February 1999
DATE OF JUDGMENT 19 April 1999
For the Applicant: Advocate J Rossouw instructed by Neels
Engelbrecht Attorneys
For the Respondent Advocate A Landman instructed by Kassel Sklaar Cohen