IN THE LABOUR COURT OF SOUTH AFRICA
CASE NO J3150/2000
In the matter between:
IMATU First Applicant
ADRIAAN PIETER STRYDOM Second Applicant
NORMAN THEO BROWN Third Applicant
WADE MICHAEL BERNING Fourth Applicant
SAMWU Fifth Applicant
and
GREATER JOHANNESBURG
METROPOLITAN COUNCIL First Respondent
THE JOHANNESBURG FRESH
PRODUCE MARKET CO (PTY) LTD Second Respondent
THE JOHANNESBURG METROPOLITAN
BUS COMPANY (PTY) LTD Third Respondent
THE JOHANNESBURG ZOO COMPANY
(INCORPORATED ASSOCIATION
NOT FOR GAIN) Fourth Respondent
ÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄ
JUDGMENT
ÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄ
JAMMY AJ
1. Pursuant to an unopposed application in terms of Rule 22(2)(a) of the Labour
Court Rules, SAMWU (the South African Municipal Workers' Union) was joined
as an Applicant in these proceedings and is accordingly cited as the Fifth
Applicant.
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2. It is common cause that, as at 30 June 2000, the Second, Third and Fourth
Applicants were employed by the First Respondent respectively at its Fresh
Produce Market, in its Bus Division and at the Johannesburg Zoo. It is also not
disputed that, as part of a restructuring and development plan known as "iGoli
2002", the First Respondent procured the formation, registration and
incorporation of the Second, Third and Fourth Respondents by virtue of the
provisions of s17D of the Promotion of Local Government Affairs Act, 91 of
1983 ("the PLGAA") and that on 30 June 2000, it concluded separate sale
agreements with each of those corporate entities in terms of which, with effect
from 1 July 2000, the business operations conducted by it in the three divisions
referred to were respectively sold to them as going concerns.
3. Section 17D of the PLGGA provides that -
"Local Authority may form company and acquire shares therein. - (1)
Notwithstanding anything to the contrary in any law contained, a local authority, or two or
more local authorities acting jointly, may -
(a) form, register and promote a company as contemplated in the Companies Act, 1973 (Act No
6 of 1973); and
(b) acquire and hold shares in a company as contemplated in the Companies Act, 1973;
Provided that the main object or one of the objects of such company shall be the
performance of a function or the rendering of a service which is substantially the same as a
function or service which a local authority may legally perform or render........."
4. During the course of June 2000, the First Respondent, by way of a
comprehensive memorandum, informed its employees in the divisions to be
corporatised, inter alia that, in terms of s197(1) of the Labour Relations Act
1995 ("the LRA"), their contracts of employment would be transferred
automatically to the relevant new corporate entities. This, it was explained,
automatically to the relevant new corporate entities. This, it was explained,
would take place with effect from 1 July 2000 and their consent was not
required provided that the terms and conditions of their existing contracts of
employment were preserved, which would, it was stated, be the case in all
respects.
5. Section 197(1) of the LRA provides as follows:
"A contract of employment may not be transferred from one employer (referred to as 'the
old employer') to another employer (referred to as 'the new employer') without the
employees' consent, unless -
(a) the whole or the part of a business, trade or undertaking is transferred as a going concern;
or
(b) ........"
6. This information was formally confirmed in a letter addressed by the First
Respondent to all its affected employees, including the individual Applicants in
this matter, on 27 June 2000 in identical terms, differing only in the reference
to the specific corporate entity concerned. The letter read as follows:
"TRANSFER OF EMPLOYMENT CONTRACT TO ..............(incorporated under Section 21)
As communicated to you in more detail earlier this month, we now confirm that your
employment contract will be transferred to ......................... in terms of Section 197(1) of
the Labour Relations Act 66 of 1995.
For ease of reference, a copy of the document which reflects the discussion of the previous
briefing sessions on migration/transfers, is attached.
It is to be noted that all your Conditions of Service and your existing fixed terms or monthly
contract benefits which you currently enjoy, as applicable to your current substantive post,
will be transferred with you to the new employer.
It is hereby confirmed that your last working day with the Greater Johannesburg
Metropolitan Council will be Friday, 30 June 2000. You will accordingly commence
employment with ...................... in your current capacity with effect from 1 July 2000, at
the time and place you are usually required to report for duty, unless you have been
advised otherwise. In the case of persons currently acting, such employees will continue
acting in terms of the Conditions of Service until such time as the need ceases to exist and
or rotation takes place in terms of the Conditions of Service.
We wish you every success in your future employment with ..........."
7. In an application brought as one of urgency on 28 July 2000 the Applicants,
having initially perceived a need for interim relief, now seek final orders in
terms set out in their Notice of Motion as follows:
"1. Declaring that the purported transfers on 1 July 2000 of the contracts of employment of the
first respondent's members employed by the first respondent at the Johannesburg Fresh
Produce Market, Bus Division and Zoo at 30 June 2000 to the second, third and fourth
respondents respectively is void and of no force or effect.
2. Declaring that such transfers can only be lawfully effected with the consent of the persons
concerned in terms of s17E of the Promotion of Local Government Affairs Act. Act 91 of
1983.
3. Ordering the respondents to pay the costs of this application jointly and severally, one
paying the others to be absolved.
4. Granting further and/or alternative relief."
8. Section 17E of the PLGAA reads thus:
"Local Authority may transfer or second officer or employee to or place his services at the
disposal of company. - A local authority may, with effect from a date determined by such
local authority, with the consent of the officer or employee concerned, transfer or second
any of its officers or employees to or place his services at the disposal of any company
referred to in Section 17D: provided that in the event of a transfer such officer or employee
shall be employed by the company concerned on such terms and enjoy such rights and
privileges as are not less favourable than those applicable to him at the time of such
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transfer."
9. No such consent, the Applicants contend, was either sought or obtained from
the employee members of the First and Fifth Applicants before the purported
transfer of their employment contracts with effect from 1 July 2000 and those
transfers, it is alleged, are therefore illegal and void.
10. The First Respondent does not dispute that formal consent to the transfer of
the contracts was at no time requested or obtained prior to the effective date
thereof. That, it submits, is because this was not required having regard to the
provisions of s197(1) of the LRA. The businesses or undertakings involved
were transferred to the new corporate entities as going concerns and the
employment contracts of employees thereby affected were automatically
transferred pursuant thereto, with no change in the terms and conditions of
their employment.
11. To the extent to which, on the issue of the requirement of consent, the
provisions of s197(1) of the LRA conflict with those of s17E of the PLGAA,
regard must be had, the First Respondent contends, to s210 of the LRA, which
provides that:
"210. Application of Act when in conflict with other laws. If any
conflict, relating to the matters dealt with in this Act, arises between
this Act and the provisions of any other law save the Constitution or
any Act expressly amending this Act, the provisions of this Act will
prevail."
12. That, the First Respondent contends, is precisely the position obtaining in this
instance. To the extent that the provisions of s197(1) of the LRA, which
exclude the need for consent in circumstances such as those here prevailing,
conflict with the express necessity to obtain it which is prescribed by s17E of
the PLGAA, the former must prevail.
13. Considerable attention was directed by Mr M Wallis, Senior Counsel for the
Applicants, to the concept of repeal by implication of an earlier statute by
Applicants, to the concept of repeal by implication of an earlier statute by
conflicting provisions of a later one which are so manifestly inconsistent with
them as to constitute a "repugnance and contradiction" as dealt with by Kotzé
AAJA in -
New Modderfontein Co v Transvaal Provincial Administration. 1919
AD 367 AT 400.
14. That, he argued, is the effect of the Respondents' contention that s197 of the
LRA prevails over s17E of the PLGAA in relation to the issue of consent. If they
are correct, what will have resulted is the partial repeal of one provision
forming part of an overall statutory scheme. This could not have been
intended by the Legislature and in any event, the two enactments are not
necessarily inconsistent. The later is of general application, whilst the former
is specially directed to a particular subject and generalis specialibus non
derogant.
15. Section 210 of the LRA moreover, it was contended, is by inference
anticipatory. Its saving provisions relate expressly to the Constitution or "any
Act expressly amending this Act." By necessary interpretation therefore, it is
argued, it is any future (my emphasis) legislative provisions, other than those
specifically referred to, which will have no application if they conflict with
specific provisions of the LRA.
16. In my opinion, neither of these submissions is sustainable. In the first instance,
the Applicants' contention that the two statutory provisions in question are not
necessarily inconsistent, and certainly not so to a degree of contradiction
which would support a finding of the repeal by implication of the earlier of
them by the later, is not challenged, correctly in my view, by the Respondents.
Their contentions support no such inference. If expunging the relevant
provisions of the PLGAA had been the intention of the Legislature, it would, as
it has done in relation to other legislation by s12 read with Schedule 6 to the
LRA, have said so. The fact that this has not been done cannot be construed
LRA, have said so. The fact that this has not been done cannot be construed
as a legislative oversight. The consent required by s17E of the PLGAA will still
be necessary where the transfers involved are not effected in the
circumstances envisaged in s197(1)(a) and (b) of the LRA.
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17. Conflicting statutory provisions are not unique and a legislated
pronouncement, where this occurs in a specific context, that one will prevail
over the other, cannot be intended to indicate an intention that the provisions
of the latter will necessarily cease to apply in any circumstances. The
perceived necessity to issue such a directive is in essence an implied provision
to the contrary. Repeal by implication, as was stated in New Modderfontein
Gold Mining Co v Transvaal Provincial Administration (supra), will not
easily be presumed and will occur only where the provisions of one statute
cannot continue at all to co-exist with those of the other and the former is not
formally and expressly repealed. There is nothing in the language of s197 of
the LRA which suggests or implies that the subservient legislation there
generally referred to will cease to have relevance or application where it is
proper that it should do so. This, however, is not such a case.
18. The second of the Applicants' contentions to which I have referred, namely the
suggested anticipatory intention of s210, cannot, I repeat, be sustained. The
language of the section is clear and unambiguous and no basis for attributing
to it anything other than the ordinary meaning of the words used can in my
view be justified. Mr Wallis' emphasis on the specific reference, apart from the
Constitution, to any amending, and therefore necessarily future, legislation,
takes no account of the reference in the section to "the provisions of any
other law" (my emphasis). There is no ambiguity in that phrase. The position
of any such law in the chronology of legislative enactments, in the absence of
any express provision to the contrary, is irrelevant. The PLGAA is patently one
such "other law". The consent requirements in s17E of that Act are manifestly
in conflict with those of s197 of the LRA. It is therefore the latter which, in
terms of s210, must prevail.
terms of s210, must prevail.
19. Finally, the submission that the relevant provisions of the LRA will not be
applicable to municipal employees because of specialised legislation governing
them cannot, in my view, be upheld in this instance. Sectors of employment
specifically excluded from the application of the Act are expressly defined in
s2. Neither Local Government nor any specific categories of employment
within it, are specified.
20. For the reasons which I have stated therefore, I find that neither the consent of
the Second, Third or Fourth Applicants, nor of any other member of the First
and Fifth Applicants, was required for the transfer of their contracts of
employment by the First Respondent to the Second, Third or Fourth
Respondents as each case may be and that the transfers in question were valid
and of full effect.
21. That being the case it is unnecessary for me to pronounce on the justification
or otherwise for the allegedly urgent basis of the application. The legal aspects
of the dispute were, as was stated, fully argued and, as far as this Court is
concerned, have been determined.
22. The application is accordingly dismissed. The Applicants are ordered jointly
and severally to pay the Respondents' costs.
ÄÄÄÄÄÄÄÄÄÄÄÄ
B M JAMMY
Acting Judge of the Labour Court
10 August 2000
Date of hearing: 28 July 2000
Appearances:
For the First to Fourth Applicants: Adv M J D Wallis SC, with him: Adv M A
Kriegler, instructed by Kochs & Dreyer, Attorneys
For the Fifth Applicant: Mr A Roskam of Cheadle Thompson & Haysom Inc
For the Respondents: Adv P Kennedy, instructed by Bowman Gilfillan Inc
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