166336IN THE LABOUR COURT OF SOUTH AFRICA
(HELD AT JOHANNESBURG)
CASE NO: J3085/99
In the matter between:
NATIONAL UNION OF METALWORKERS OF SOUTH AFRICA & OTHER
Applicants
And
DZIMA MANUFACTURING (PTY) LIMITED Respondent
JUDGMENT
STELZNER AJ
1. This is an application for final relief in respect of an urgent
interdict. A rule nisi was issued by Landman J on 6 August 1999,
the matter was argued before me on 11 August 1999 and on 13
August 1999 I gave the following order:
1.1 The failure of the applicant to comply with the time periods
and the manner of service referred to in the rules for the conduct
of proceedings in the Labour Court is condoned and this matter is
dealt with as one of urgency in terms of rule 8.
1.2 The respondent has failed to give notice and to consult the
union in terms of section 1(d) of annexure “A” to the Main
Agreement of the Metal & Engineering Industries Bargaining
Council about the closure of the respondent’s Seshego factory
and the retrenchment of all its employees.
1.3 The respondent is interdicted and restrained from retrenching
any of first applicant’s members until it has complied with its
obligations in terms of section 1(d) of annexure “A” of the Main
Agreement.
1.4 Respondent is directed to pay the costs of this application.
2. The reasons for my decision are set out hereinbelow.
3. The applicant, the National Union of Metalworkers of South Africa,
(hereinafter referred to as “the union”) seeks an order restraining
the respondent, Dzima Manufacturing (Pty) Limited, (hereinafter
referred to as “the company”), from carrying out its decision to
close its Seshego factory and from retrenching the union’s
members employed at that factory pending compliance by the
company with the provisions of section 189 of the Labour
Relations Act No 66 of 1995, as amended (“the Act”) and / or
pending compliance by the company with the provisions of
section 1(d) of annexure “A” to the Main Agreement for the Metal
& Engineering Industries Bargaining Council concerning the
closure of the factory and the retrenchment of all its employees
on 6 August 1999.
4. It was common cause that the individual applicants were all
members of the union and were employed by the company at its
factory at Seshego. The respondent employs 103 employees of
whom 93 are hourly paid, the majority of those hourly paid
employees being members of the union.
5. The business of respondent was previously operated by Duro
Industries (Seshego) (Pty) Limited. Respondent acquired the
business from Duro Industries (Seshego) (Pty) Limited on or
about 7 March 1998. The employees’ contracts of employment
were transferred to the respondent with no change to their terms
and conditions of employment as envisaged by the provisions of
s 197 of the Act. This much was common cause.
6. On or about 27 January 1998 a collective agreement was entered
into between Duro Industries (Seshego) (Pty) Limited and the
union. Due to the pivotal importance of this agreement to this
case the contents of the agreement are quoted hereunder in full:
“The parties agreed on the scope of the Engineering Main
Agreement. That this agreement shall operate from June to
gazettal of each year. In line with Main Agreement at industry
level. Whilst agreeing to the condition of the Main Agreement,
the company exclude (sic) itself from the following:-
1. PART ONE OF THE MAIN AGREEMENT
1.1 HOURS OF WORK
The hours of work shall remain at 45 hours ordinary hours per
week till the company join the Employers Association (SEIFSA).
But for now it will pay 45 hours per week (old status). Other
condition (sic) in section 4 of the Engineering Agreement shall
apply.
2. PART TWO OF THE MAIN AGREEMENT
The company subject (sic) the whole part two for negotiation.
Apart from the two exempted areas the company agree on:
2.1 SICK LEAVE
12 days sick leave per year.
2.2 WAGES
10% wage differentials.
2.3 LEAVE BONUS
Will be calculated at 10% not 8.33% of the agreement.
Outside the contents of this agreement, the company agreed to
pay office bearers 18 days per year paid and a further 18 days
per year unpaid and that this is a subject for the coming June
1998 negotiations to have these days paid. This comes as a
result of the union demanding that the 18 + 18 days be fully
paid.”
Chronology of events
7. I have based my decision on the facts summarised below which
are the facts which are either common cause or as set out by the
respondent in its answering affidavit together with only those
allegations of the applicant that the respondents could not deny,
along the lines of the approach set out in Plascon Evans Paints
Ltd v Van Riebeeck Paints (Pty) Ltd 1984(3) SA623 (A) at 634E-G.
8. On 28 May 1999 representatives of the union met with
representatives of the company to discuss various issues. The
company stated that it called this meeting as a result of its
ongoing loss making situation and the steadily deteriorating
relationship with the union. The agenda of the meeting which
formed part of the papers before me indicated that there were 10
agenda items. Items 8 and 9 were headed “Company
losses/Production” and appear to have constituted the
penultimate subject of discussion at the meeting. The minutes
reflect that “ Dzima management raised the issue of company
losses and the manager made his intention clear that he was in
the process of restructuring the business because the company
is losing money.”
9. On 30 June 1999 the company wrote to the union by way of a
letter entitled “ Notification of a perceived need to implement
retrenchments”. The letter read as follows:
“It is with regret that this company finds itself in a position where
a reduction in the workforce may be necessary due to the
prevailing economic circumstances and its impact upon our work
load.
Accordingly, notification is provided of this company’s intention
to enter into a consultation process with yourselves and your
representatives concerning this perceived need.
Since certain of your members employed at this company may
be affected by this perceived need for retrenchment, it is
requested that you meet with representatives of the company on
6 July 1999 at 10h00 or on 8 July 1999 at 10h00 in order that
your views, thoughts and suggestions on the possible
retrenchment be ascertained and a process of consultation take
place.
Please contact the writer as soon as possible to confirm either of
these dates or to make alternative mutually suitable meeting
arrangements.”
10. On the same day (30 June 1999) respondent issued a notice to
its employees wherein the employees were advised that
respondent was contemplating retrenchment. On the same day
also the union sent a fax to the company in which it requested
that the company comply with section 189 of the Act. At the
same time the union confirmed a meeting for 8 July 1999.
11. In the meantime and on 5 July 1999 the company forwarded a
letter to the union wherein it was stated that respondent would
comply with the provisions of section 189 of the Act. (It was
common cause that the letter was not accompanied by written
disclosure as envisaged by s 189). Thereafter and on 6 July 1999
respondent sent a fax to the union stating its intention to embark
upon short time as from 13 July 1999, with working hours being
confined to 07h00 to 12h00 until further notice, for all hourly paid
employees with the exception of drivers and assistants.
12. On 8 July 1999 the parties met. There was some discussion
and dispute at the meeting of 8 July 1999 about the issue of short
time, the detail of which is not essential for the purposes of this
application. The company advised the union at the meeting that
approximately 60 people would be affected by the need to
retrench. The union’s response was that the company was
required to comply with section 189(3) and had to disclose
certain information. Respondent states that the union was
requested to indicated specifically what information was required
to be disclosed but that the union failed to be specific in this
regard.
13. On 9 July 1999 the union wrote to the company confirming
that it had asked for compliance with section 189 of the Act, this
fax being addressed to one of the directors of the company, Mr
Alex Mzizi. The letter refers to Mr Mzizi’s undertaking to assist in
the matter and indicates that the union is awaiting a response.
Thereafter ensued some discussions and correspondence on the
issue of short time which it is not necessary to deal with in detail.
On 12 July 1999 the company sent a fax to the union in which it
undertook to provide financial information subject to the relevant
union official signing a confidentiality agreement. The issue of
short time continued to be a problem with the company
maintaining that the lack of co-operation by union members was
jeopardising the ability of the company to survive.
14. On 14 July 1999 Mr Mzizi responded to the earlier letter of the
union. Once again the statement is made that the company will
comply with section 189 of the Act and this is followed by a
request that the union assist the company in a spirit of mutual
co-operation.
15. On 19 July 1999 the company addressed the union in some
detail, which letter purported for the first time to constitute
compliance with the provisions of section 189 of the Act. In the
letter the company specifically stated that it was suffering losses
of approximately R100 000-00 per month, that it was in dire
financial straits and that it “ may have to close its operation and
retrench all workers should the planned action not succeed in
stemming losses” (my underlining). The letter went on to state
that all employees would be affected in the event of a closure
and 40 in the event of a retrenchment and proposed that
employees’ employment be terminated on 31 July 1999. The
union was invited to consult with the company at any time during
the week commencing 19 July 1999 until 25 July 1999. It was
furthermore stated that should the union sign a confidentiality
agreement the company would disclose the financial information
to the union. Finally, it was stated that if the union did not
respond to the letter or take the opportunity to consult then the
company would implement its proposals with effect from 31 July
1999.
16. The letter dated 19 July 1999 was only faxed to the union
offices on 20 July 1999. On 21 July 1999 the union responded
indicating that it was not available during the week of 19 July to
25 July 1999 (part of which had already gone past by the time the
union received the invitation) due to other commitments and that
a meeting could in any event not proceed until information had
been disclosed. The union reiterated that the meeting of 8 July
1999 had not been fruitful as the company had not complied with
section 189 of the Act. In the same letter the union made the
sweeping statement that it would expect that it would need 60 to
90 days to be in a position to be fully informed after receipt of
the detailed information which was requested. At the same time
the union sought agreement from the company to bear the costs
of a financial adviser and other experts.
17. Despite the sweeping statements and demands made in the
preceding letter, however, on 22 July 1999 the union sent a fax to
the company requesting that it be informed whether the
requested information was ready for collection, confirming at the
same time that the union would then sign the confidentiality
agreement. In the meantime there was an allegation by the
company that union members were embarking upon a “go-slow”,
which allegation was denied by the union. It is not possible or
necessary for me to decide this dispute on the papers. Even if
the company is correct and union members were on a go-slow
there was no suggestion that this was being instigated or
supported by the union nor could such action on the part of its
members be said to constitute intransigence on the part of the
union in regard to the retrenchment consultations.
18. On 23 July 1999 the company wrote to the union again. This
letter commenced as follows:
“We refer you to the collective agreement entered into between
the parties in terms of which it was agreed that the scope of the
Main Agreement for the Engineering Industry would be extended
to cover the operations of the company and that the parties
would comply with the Main Agreement in all respects except in
a number of specific exceptions. In terms of clause 35 of the
Main Agreement the company is required to give at least 21 days
notice of any contemplated retrenchment. The provisions of the
Main Agreement require the company to invite the union to enter
into good faith consultations regarding the contemplated
retrenchments.”
The letter goes on to suggest that the company had advised the
union on 30 June 1999 of the fact that it was contemplating
retrenchments. It further suggests that a consultation had taken
place on 8 July 1999 whereat the company disclosed “all critical
financial information ”. It was alleged that in the circumstances
the company had fully complied with the provisions of the Main
Agreement and that the union’s reference to section 189 of the
Act was misplaced. Notwithstanding the above, however, the
company indicated that it was still prepared to indulge the union
by disclosing specifically requested financial information provided
that the union signed a confidentiality agreement. No such
information had to date been disclosed, however, confirms the
company, because the union has to date not signed the
confidentiality agreement. The company then goes on to state
that, subject to the signing of a confidentiality agreement, it is
willing and prepared to furnish the following financial information
to the union:
18.1 Detailed profit and loss account for period since
commencement of trade.
18.2 Summarised profit and loss account for period since
commencement of trade.
18.3 Balance sheet of Dzima Manufacturing (Pty) Limited as at end
February 1999.
18.4 Interim statement for Dzima Manufacturing (Pty) Limited
prepared 1 March to 30 May 1999.
18.5 Analysis of annual window production showing profitability per
product.
18.6 Outstanding order report.
18.7 Outstanding work load.
18.8 List of all employees and rate of pay.
18.9 List of commencement dates of all employees.
Finally the union is requested to contact the company as soon as
possible to arrange consultations for the week of 26 to 30 July
1999 failing which it is stated that the company will implement
the retrenchment with effect from 30 July 1999, paying each
affected employee one week’s remuneration for each year of
completed service and giving the affected employees one day’s
notice. The company then goes on to say that if it decided to
close down the whole operation the issue of selection criteria
would be of little consequence. However, in the event of it
deciding to retrench only some of the employees then the criteria
of last-in-first-out with the retention of necessary skills would
apply.
19. On 26 July 1999 the local union organiser sent a telefax to the
regional office requesting assistance on an urgent basis in regard
to the forthcoming meetings with the company. On 27 July 1999
the regional secretary of the union wrote to the company
proposing a meeting on 28 July 1999 to consult further on the
proposed retrenchments. A meeting duly took place on that
date. When the union arrived for the meeting it received a letter
dated 26 July 1999 attached to which were the documents
specified in the letter of 23 July 1999. On receipt of the
documents the union signed the required confidentiality
undertaking. The meeting then proceeded. By no stretch of the
imagination in my view can it be said that the union’s conduct as
set out above was dilatory or obstructive.
20. At the outset of the meeting of 28 July 1999 the union official
required clarification as to whether the company would be
closing down or would only retrench a number of employees.
The company had not made its position in this regard clear
before that point and its response was then that initially it had
contemplated retrenchments but as a result of deteriorating
circumstances it had decided to close down the business with
effect from 30 July 1999. In its papers before this court the
respondent made the further statement that a cursory glance at
the balance sheet read with the profit and loss account indicated
that the business was insolvent and that respondent could only
trade with the support of its shareholders who were no longer
prepared to afford such support. The union’s proposal at the
meeting was that the company look at the longer term rather
than the short term option of closing the company. After an
adjournment to canvass the views of the members the union
proposed that the retrenchment date be extended until the end
of August 1999 to enable the union to consider the financial and
other information disclosed by the company.
21. On 30 July 1999 the company telefaxed the union in response
stating that it was unable to extend the effective date to the end
of August due to the extent of the losses being suffered, nor was
it able to respond positively to the union’s suggestion to extend
the working of short time. The respondent was prepared to
extend the closure date to 4 August 1999 and held itself
available for consultations on 3 August 1999. Clearly, however,
the decision to close which was communicated to the union on 28
July (at which date the union for the first time obtained any real
disclosure of relevant information) remained immutable.
22. The union nevertheless confirmed its availability for the
meeting on 3 August 1999, at which meeting the company was
represented by its attorney. The union indicated that it had not
been in a position to obtain financial advice in the short time
available and therefore confined itself to tabling proposals in
regard to severance pay and assistance to retrenchees. In the
circumstances I do not take this to mean that the union was
accepting the position, but rather that it was simply trying to
make the best of it in the face of the company’s stated course of
action. The attorney representing respondent confirmed that the
company intended to close. On 4 August 1999 respondent’s
attorneys of record confirmed in writing the final decision of
respondent in respect of the closure of the business and the
retrenchment of the individual applicants. This was to take place
on 6 August 1999.
23. There was some dispute as to the time at which the
retrenchments would have taken effect on 6 August 1999 having
particular regard to the fact that the individual applicants were
on short time which meant that they would ordinarily have
finished work at 12h00 on that day. It was common cause that
the parties were in court arguing the urgent application before
Judge Landman at 12h00 on 6 August 1999, Judge Landman’s
interim order having been issued at 12h25 on the aforesaid date
on conclusion of argument and some oral evidence.
Respondent’s evidence was to the effect that the individual
applicants did not render services on 6 August 1999 but merely
attended at the respondent’s premises in order to collect their
payslips, the last payslip having been collected by 09h30 that
day. The letter of 4 August 1999 from respondent’s attorneys
simply confirmed “the company will close with effect from Friday
6 August 1999”. The letter also, significantly, indicated that
retrenched employees would be paid one week’s severance pay
per completed year of service, pro rata leave pay including pro
rata long service leave pay and notice pay in accordance with the
Main Agreement.
Argument and conclusions
24. The union’s case before me was based on an alleged failure
on the part of the company to comply with the provisions of
section 189 of the Act prior to closure and retrenchment and,
secondly, on the alleged failure by the company to comply with
the provisions of section 1(d) of annexure “A” to the Main
Agreement. It was common cause that annexure “A” to the Main
Agreement is an annexure to Part One of the Main Agreement
and, further, that section 1(d) thereof requires 21 days notice of
an intention to retrench and 30 days notice of an intention to
close. The section is not simply notice provision but, rather,
provides as follows:
“(i)An employer wishing to close or relocate any factory,
company, enterprise, or part thereof, shall provide the Regional
Council and the party trade unions representing the affected
employees with the following written information at least 30 days
prior to the intended closure of relocation:
The proposed date of relocation and / or closure;
(ab) the proposed number of employees to be affected by such
relocation or closure;
(ac) the specific reason(s) for the relocation or closure.
The employer and party trade unions concerned shall hold
themselves available at all reasonable times within such 30-day
period to consult in good faith in an endeavour to reach
agreement on matters related to the proposed relocation or
closure:
Provided that the provisions of (I) and (ii) above shall not apply in
respect of a factory, enterprise, business of company which is
placed in liquidation in terms of the Insolvency Act.”
25. It was common cause, further, that the company had at no
stage given notice as contemplated by section 1(d) of annexure
“A” to the Main Agreement of its intention to close the factory.
(It is doubtful even whether there had been notice of intention to
retrench as contemplated by section 1(d) of annexure “A” to the
Main Agreement.) Accordingly, if the provisions as aforesaid are
applicable then respondent is in breach thereof. Whether such
breach is sufficient to justify the relief sought by the union is
dealt with more fully below.
26. Respondent’s argument was that a reading of the collective
agreement (quoted in full above) suggested ambiguity as to the
application and/or interpretation thereof. Where there is
ambiguity as to the application or interpretation of a collective
agreement this court has held that such a dispute must, in
accordance with the provisions of section 24(2) of the Act, be
determined by the CCMA by way of arbitration proceedings. (See
Food & Allied Workers Union v Premier Foods Industries Ltd (Epic
Foods division) (1997) 18 ILJ 1082 (LC)). I was referred to further
authority for the proposition that this court does not have the
jurisdiction to consider the interpretation and/or application of a
Main Agreement. (See Denel Informatics Staff Association &
another v Denel Informatics (Pty) Ltd 1999 (20) ILJ 137 in
particular 139I-J; and SA Commercial Catering & Allied Workers
Union v Woolworths (Pty) Ltd 1998 (19) ILJ 57 (LC) which deals
with the same principle in relation to a different section of the
Act). I accept these decisions as being correct.
27. Mr Bruinders, who appeared for the applicant, argued,
however, that on the facts of the matter before me there was not
in truth any real dispute about the interpretation or application of
the provisions of a collective agreement or the provisions of the
Main Agreement such as contemplated in the aforementioned
authorities and which would thus deprive this court of
jurisdiction. If Mr Bruinders is correct in this submission then it
would appear that the facts of this case are distinguishable from
those quoted above. The alleged dispute arises when
respondent’s general manager, Mr Dickerson, deposes to his
affidavit in the answering papers filed by the respondent. In his
affidavit Dickerson states as follows: “I was under the mistaken
belief that the respondent agreed to comply with the provisions
of the Main Agreement. I have ascertained that the respondent
had only agreed with the applicant to comply with the Main
Agreement insofar as certain aspects are concerned and then
only as a guideline. ” This averment is made against the
background of the clear and overt prior statement by the same
Mr Dickerson in which he confirms that respondent regards itself
as bound to comply with the provisions of annexure “A” to the
Main Agreement and in which he seeks to justify compliance by
respondent with those provisions as a matter of fact (see the
letter of 23 July 1999 referred to and quoted above). When one
reads Dickerson’s letter of 23 July 1999 together with the terms
of the agreement quoted in full above it is quite clear that apart
from one exception in regard to hours of work, Part One of the
Main Agreement was incorporated into the provisions of the
collective agreement between the parties and, thus, by reference
into the employment contracts of the individual applicants.
Nowhere in the collective agreement is the word “guideline”
used. The agreement may not be a model of grammatical
correctness but that does not in itself render the terms of the
agreement ambiguous. Particularly when Mr Dickerson himself,
and while in the throes of a retrenchment exercise in respect of
which the applicability of these provisionsn was highly relevant,
states that he regards the company as bound thereby to follow
the terms of annexure “A” to the Main Agreement.
28. Moreover, even respondent’s attorneys, writing on
respondent’s behalf on 4 August 1999 confirming the closure and
the terms of the retrenchments, confirm that notice pay will be in
accordance with the Main Agreement. Nowhere in his answering
affidavit does Mr Dickerson explain the basis of his so-called
mistake. In the circumstances his bare denial of the applicability
of the provisions of the Main Agreement cannot be regarded as
sufficient to create a real dispute about the interpretation or
application of the agreement. (See the approach of the court in
Soffiantini v Mould 1956 (4) SA [EDLD] at 154F ff.)
29. It is common cause that the provisions of the Main Agreement
would not, but for their incorporation into the collective
agreement between the parties, be applicable as respondent
does not fall within the scope of application of the Bargaining
Council for the Metal & Engineering Industries. The agreement
was also not extended to cover respondent’s operations
statutorily. Rather, the agreement has been extended by private
agreement. The fact, therefore, that the parties do not ordinarily
process their disputes through the dispute resolution
mechanisms provided for by the Bargaining Council and did not
do so in this instance either is not conclusive of an intention not
to be bound by the provisions or certain provisions of the Main
Agreement. Moreover, the parties could not by private
agreement bind a third party in the form of the Bargaining
Council, to preside over their disputes. In agreeing to incorporate
the terms of the Main Agreement into their collective agreement
one would obviously have to read in the changes dictated to by
the context (such as reference to party trade unions being taken
to mean references to the union which was party to the collective
agreement.) In my view, therefore, this court is not in the
circumstances of this case interpreting or applying the provisions
of the Main Agreement but is, rather, holding the parties to their
private agreement.
30. In this case what we have is a collective agreement which also
regulates the terms and conditions of employment and the
conduct of employers in relation to their employees, by virtue of
the provisions of section 23(1)(c) of the Act. The provisions of
section 1(d) of annexure “A” to the Main Agreement place
specific obligations on an employer wishing to close a factory, as
set out in the section quoted in full above. Thereafter both
parties are required to hold themselves available at all
reasonable times within such 30-day period to consult in good
faith and in an endeavour to reach agreement on matters related
to the proposed relocation or closure. It is further provided, as
can be seen from the section quoted above, that the
aforementioned provisions do not apply in respect of a business
which is placed in liquidation in terms of the Insolvency Act. An
order in terms of which the business was placed under
provisional liquidation in terms of the provisions of the Insolvency
Act would have had the effect of immediately terminating the
contracts of employment of all the individual applicants by
operation of the law. In the absence thereof the employer was
required to comply with the notice and consultation provisions as
contained in section 1(d) of Annexure “A” to the Main Agreement
and as outlined above.
31. In my view the facts in this matter are also distinguishable
from the facts in the Premier Foods case referred to above in that
the provisions of section 1(d) of annexure “A” to the Main
Agreement do not constitute a simple requirement that
employees to be retrenched and/or the union be given a
specified period of notice. The 30-day notice requirement is
coupled with a substantive obligation to consult with a view to
reaching agreement. In such circumstances it would not be
correct to say that the applicants have an adequate alternative
remedy in that a dispute about non-compliance with the
provisions of the collective agreement could be referred to the
CCMA for conciliation and thereafter adjudication. If respondent
is not interdicted and restrained from implementing the
retrenchments until such time as the notice and consultation
provisions have been complied with then proper consultation with
a view to reaching agreement will not take place. The individual
applicants may in due course be compensated for the notice
which they did not receive but such a compensation order would
not be able to replace the fact that they were not afforded a
proper opportunity, through their representatives, of consulting
properly with the company concerning the proposed closure and
retrenchments, which consultation has at least the prospect of
culminating in consensus on some means other than closure of
addressing the company’s concerns.
32. Mr Redding, who appeared on behalf of the respondent,
sought to argue that I could not, alternatively ought not to, issue
an order effectively reinstating employees whose services had
already been terminated. He argued that this court has generally
been reluctant to grant reinstatement orders on an urgent basis
where employees have been dismissed and is inclined only to do
so in exceptional circumstances. In this regard I was referred to
the decision in SA Chemical Workers Union & others v
Sentrachem (1999) 20 ILJ 1590 (LC).
33. In the first place I am not persuaded that as at the time this
matter came before me the individual applicants had already
been dismissed in the sense that their employment contracts
and/or the employment relationship between them and the
respondent had been terminated. Respondent had given notice
that it was to close its factory on 6 August 1999. I accept Mr
Bruinders’ argument to the effect that this, unless the contrary is
stated, should be taken to mean that the business would have
closed and the contracts would have terminated at the earliest at
the close of business on 6 August 1999. In the circumstances, at
the earliest for respondent, the employment contracts would
have terminated at 12h00 on 6 August 1999. They could well
have terminated some time later as it was common cause on the
evidence that some employees were not on short time and would
have worked (or could have been required to work) until 15h30
on that day. It would certainly seem, in the circumstances, that
the business would not have closed before 15h30 on 6 August
1999. In any event, the fact that the working day of the
individual applicants was shortened at respondent’s instance or
that they were not required to tender their services or work out
the normal working day cannot be taken to mean that their
employment contracts terminated earlier than provided for in the
notice given by respondent. They may have even terminated
later by virtue of the payment in lieu of notice. Even if the
employment contracts would have terminated at 12h00 on
6 August 1999 both parties were at that stage in court arguing an
application on an opposed basis in terms of which the applicants
were seeking to restrain the respondent from effecting such a
termination. At the conclusion of those proceedings Landman J
issued an interim order in terms of which the respondent was
interdicted and restrained from proceeding with such
terminations. In the circumstances I am of the view that it would
be artificial and possibly even contemptuous of respondent to
suggest that as at the time the matter came before me the
employment contracts of the individual applicants were no longer
in existence.
34. That being the case what I am asked to do in this matter is
simply to extend the life of these employment contracts until
such time as respondent has complied with its obligations in
terms of section 1(d) of annexure “A” to the Main Agreement. Mr
Bruinders did not persist with his prayer for relief in the form of
an interdict restraining respondent from closing its factory and
the order which I made was thus deliberately couched in terms
which only interdicted respondent from retrenching any of the
first applicant’s members until it had complied with its
obligations in terms of section 1(d) of annexure “A” of the Main
Agreement. As such the facts of this case are clearly
distinguishable from those of the Sentrachem case where this
court was being asked to reinstate employees who had already
been retrenched, pending the outcome of an application based
on the alleged unfair dismissal of the employees. In the
Sentrachem case it was quite correctly pointed out that the
legislature saw fit in relation to the 1995 Act not to perpetuate
the status quo relief which was available to applicants under the
provisions of section 43 of the 1956 Act.
35. In the circumstances I was persuaded that the applicants had
made out a case for relief in the form of a final interdict, in that
they had in my view established a clear right and the absence of
an adequate alternative remedy. As far as the reasonable
apprehension of harm is concerned that harm was manifest as a
result of respondent’s stated intention to close the business and
retrench all its employees. It was on that basis that I gave the
order which I did on 13 August 1999.
36. As far as the further and alternative allegation by the union is
concerned, namely, the company’s alleged failure to comply with
the provisions of section 189 of the LRA, I do not believe that it is
necessary for me to decide this aspect given my ruling on the
first argument.
37. It may well be, however, that the respondent in this matter is
guilty of a failure to comply properly with the provisions of
section 189 of the Act particularly in the sense contemplated by
the Labour Appeal Court in Johnson & Johnson (Pty) Ltd v
Chemical Workers Industrial Union (1999) 20 ILJ 89 (LAC). On the
facts before me (as outlined above) I have formed the view that
respondent’s conduct falls short of the requirements of section
189 which, in my view (and according to the Labour Appeal Court
in the Johnson decision), places the primary obligation on the
employer. I do not think that the union’s conduct can be said to
have been obstructive in the sense that it can be said that it is
the union’s fault that joint consensus-seeking was not achieved. I
am aware that this court has expressed a reluctance to sanction
an attempt on the part of an applicant to conduct a trial by way
of urgent application. (See Vela & others v Savo & others (1998)
19 ILJ 916 (LC)). I might add that I do not think that this is what
the applicant was seeking to do in this matter.
38. I did not make an order interdicting or restraining the
respondent from effecting the retrenchment of applicant’s
members pending compliance with the provisions of section 189
of the Act in this case as it was not necessary to do so given the
order which I made concerning compliance with section 1(d) of
annexure “A” to the Main Agreement. There might well be
circumstances, in my view, however, where an applicant could
adequately show a failure on the part of a respondent to comply
with the provisions of s 189 and the absence of a adequate
alternative remedy to the extent that relief in the form of an
interdict pending compliance with the provisions of s 189 would
be appropriate. Otherwise, in my view, the ratio in the Johnson
decision has no teeth and respondents (employers) can simply
avoid entering into meaningful joint consensus-seeking on
retrenchment related issues, particularly in a closure situation, by
suggesting that the applicants seek their remedy at a trial in due
course into the fairness or otherwise of their dismissals. The only
likely penalty in the end in such circumstances would be an order
of compensation which at such stage might afford the applicants
cold comfort if the business has in the meantime been liquidated
or has disposed of its assets. Certainly the employer would have
avoided the obligation of genuinely seeking to achieve consensus
on alternatives to closure and / or retrenchments.
39. Both parties were ad idem that this was a matter in which
costs should follow the result. It is also apparent that an ongoing
relationship between the parties appears unlikely. There seems
no reason therefore, either on the basis of law or fairness, not to
award costs in favour of the successful party.
40. In the event, the court granted the order set out in paragraph
1 above on 13 August 1999.
S STELZNER
Acting Judge of the Labour Court of South Africa
DATE OF HEARING: 11 August 1999
DATE ON WHICH ORDER
GIVEN:
13 August 1999
DATE ON WHICH REASONS
FOR THE ORDER SUPPLIED:
18 August 1999
APPEARANCE FOR
APPLICANT:
Mr T Bruinders
INSTRUCTED BY: Cheadle Thompson &
Haysom
APPEARANCE FOR
RESPONDENT:
Mr A Redding
INSTRUCTED BY: